Here's Why Bitcoin Has Decoupled From Stocks According To Standard Chartered

• Standard Chartered Head of Digital Assets Research Geoffrey Kendrick has weighed in on the catalyst for Bitcoin’s recent decoupling from stocks.
• Kendrick said the catalyst for Bitcoin’s current run could send it to fresh all-time highs.
• Bitcoin is now trading at a key level.

Despite the persisting narrative that Bitcoin is an asset with the potential to become a store of value on par with gold, if not better, the asset has, for the most part, traded in tandem with tech stocks, failing to hold up in the face of market uncertainty. 

And until recently, things looked no different in the current cycle. Amid President Donald Trump‘s controversial tariff policies and inflation concerns over the past few months, Bitcoin followed the Nasdaq and S&P 500 in a significant retreat from record highs. But this week, there has been a marked shift in this correlation despite no apparent change in market conditions.

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On Monday, Bitcoin jumped nearly 3% from around $85,000 to highs above $88,000, while traditional equities continued their slump, with the Nasdaq and the S&P 500 dropping about 2%. Is Bitcoin finally taking its place in the pantheon of safe-haven assets?

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Risks To The Financial System

In a Tuesday note, Standard Chartered Head of Digital Assets Research Geoffrey Kendrick said that Bitcoin traded like a tech stock except in times of risk to the legacy financial system. In these instances, Kendrick asserted that the asset acted as a hedge, citing its price action during the banking crisis that led to the collapse of several banks in Q1 2023.

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Kendrick opined that in the case of Bitcoin’s most recent rally, investors were reacting to risks to the financial system associated with the government amid the growing threat to the Federal Reserve’s independence under the Trump administration.

In recent weeks, Trump has openly tried to twist the arm of Fed Chair Jerome Powell to cut interest rates using personal attacks on social media. 

“There can be a SLOWING of the economy unless Mr. Too Late, a major loser, lowers interest rates, NOW,” Trump wrote, referring to Powell in a Monday Truth Social post, asserting that “there is virtually No Inflation.”

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Kendrick said that the attacks are triggering uncertainty in the Treasury market, with which he highlighted that Bitcoin is strongly correlated. Specifically, the 10-year Treasury term premium has surged to 12-year highs, with Bitcoin seemingly replicating its run.

“As such, so long as Fed independence issues continue to play out I think Bitcoin will keep heading higher. This could be what is needed for the next all-time high,” Kendrick wrote, reiterating his $200,000 year-end price target for Bitcoin and $500,000 target for 2028.

Indeed, Bitcoin continues to run higher at the latest look, surging 5% in the past 24 hours to trade near $91,000 for the first time since early March. Several analysts have marked the $90,000 to $92,000 price range as the level to beat for the leading digital asset to confirm the start of another impulsive phase.

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