The S&P 500 index represents the 500 largest companies in the U.S. and serves as a barometer for the American economy. Its performance influences Bitcoin primarily through the macroeconomic sentiment of investors. When the S&P 500 is rising, it reflects confidence in the markets, which tends to attract capital to riskier assets like Bitcoin. Conversely, during downturns, especially with risk aversion, investors typically withdraw money from crypto assets, leading to declines in BTC. Additionally, both tend to react to factors such as interest rates, inflation, and U.S. monetary policy, creating a moderate correlation between the two markets.
