Store of Value? Recent Price Action Shows Bitcoin Decoupling from Risk Assets

Bitcoin has shown resilience in the face of a broader market capitulation, with prominent analysts suggesting a decoupling from risk assets.

The US stock sell-off reached insane levels yesterday as Donald Trump’s tariff hike continued to push the broader market sideways. After investors pulled out $2.85 trillion from the US stock market on April 3, they resumed with another $1.5 trillion at market open on Friday.

At the end of Friday’s trading session, the US stock market’s value shed $3.25 trillion, the worst two-day risk asset dump in five years. While this fracas continued, the crypto market took a contrarian stand, surprising prominent market watchers.

Bitcoin Adds Billions of Dollars While Risk Assets Dumped

Interestingly, Bitcoin and the broader crypto market saw massive inflows despite risk asset sell-offs in the US market. Data showed that $5.4 billion flowed into the sector on Friday, marking a sentiment shift among global investors.

Crypto Market Adds $54 billion

What was more fascinating about Friday’s Bitcoin contrarian play was that the dumps affected gold, which has been in fine form since the market depression. The precious metal hit a new all-time high of $3,167 on April 3 but dropped sharply yesterday to near $3,000, spurred by adverse market conditions.

Bloomberg’s ETF analyst James Seyffart highlighted this morale-boosting event for the crypto market in an April 4 tweet. The prominent market watcher noted he was aghast at Bitcoin’s resilience in the face of the sell-offs, a feat the pioneering crypto has recently failed to pull off.

He noted that Bitcoin’s trend above $80,000 despite yesterday’s risk asset sell-offs and gold’s failure to keep its cool left him “genuinely shocked.” This again reinstates Bitcoin’s emerging maturity and store of value characteristics.

Bitcoin Decoupling from Risk Assets?

In response to Seyffart, Adam Back, the co-founder of Blockstream, alleged that Bitcoin is finally decoupling from risk assets. For context, the crypto firstborn has mirrored the trend of the US stock market since the tariff development, raising skepticism among crypto market enthusiasts.

However, yesterday’s event suggested a change of course. Back noted that the resilience might have come from market makers leveraging the lack of fiat liquidity to autocorrect Bitcoin’s correlation.

For perspective, the recent global market downturn saw investors take a cautious stand, limiting liquidity supply to the assets like Bitcoin. In these market conditions, market makers can supply liquidity and influence the price action of cryptocurrencies, as trading volumes are low to counter such manipulation.

Meanwhile, Seyffart suggested that this resilience might come from incessant Bitcoin demand from companies like MicroStrategy, Marathon Digital, and, most recently, GameStop. Notably, MicroStrategy has resumed its weekly Bitcoin acquisition after a brief stop, buying the asset for the third week running.

Meme stock firm GameStop recently adopted Bitcoin as its primary treasury asset, announcing afterward that it would raise $1.3 billion to stack more of the asset. The Bloomberg analyst noted that this demand might have kept Bitcoin up in the face of the current adverse market condition.

At the time of writing, Bitcoin trades at $83,338, up 1.2% in the past week.

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