Bitcoin sits in the mid-$60,000s, down roughly 30% year-to-date and approximately 48% below its October 2025 all-time high above $126,000. Meanwhile, the S&P 500 trades between 7,600 and 7,763 while the Nasdaq posts double-digit gains in 2026. This divergence is unusual: historical correlation between Bitcoin and the S&P 500 typically exceeds 70%. Global liquidity, with M2 money supply around $135 trillion, has not been enough to support Bitcoin’s price, which also faces selling pressure from miners and complex options positioning. For institutional investors, this underperformance raises questions about Bitcoin’s role in portfolio allocation, with the diversification argument taking a hit.
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