What Do On-Chain Data Show for Bitcoin? Correlation with Stocks Is Gradually Declining

Cryptocurrency analysis platform Santiment has published a new report noting that digital assets are beginning to diverge from traditional markets amid rising global uncertainties and war tensions.

According to data shared by Santiment analyst Brian Quinlivan, the cryptocurrency market has shown resilience against the S&P 500 and gold in recent weeks.

An examination of the last five weeks shows that while the S&P 500 index has lost approximately 2.2%, Bitcoin has risen by 2.4% and gold by 3.7%. Santiment notes that Bitcoin is now beginning to break its correlation with stocks and is charting its own course, being perceived as “digital gold” during periods of increased geopolitical risk.

Onchain data shows that “whale and shark” wallets holding between 10 and 10,000 BTC have started accumulating again in the last two weeks. The number of wallets holding 100 or more BTC has surpassed the 20,000 mark, reaching a historic record.

Although the refusal of small investors (with holdings under 0.01 BTC) to leave the market and their attempts to buy every dip are seen by analysts as a short-term bull trap, long-term indicators remain positive.

Santiment, which examines the Market Value – Realized Value (MVRV) ratio, notes that the 365-day MVRV is around -25%. This data indicates that long-term investors are currently at a loss, and mathematically, buying at these levels carries much less risk than when the market peaked.

The negative trend in exchange funding rates proves that investors are taking short positions expecting the Bitcoin price to fall. Santiment states that this situation could trigger a “short squeeze,” and the liquidation of these positions could cause the price to surge upwards.

Ethereum is currently closely following Bitcoin, but a slowdown in network growth and active address numbers is noted. Dogecoin and Internet Computer (ICP) were among the top performers this week, while privacy-focused coins are observed to be losing value.

*This is not investment advice.

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