Bitcoin (BTC) Dominance Grows as BTC/S&P 500 Ratio Hits All-Time High

Welcome to the US Crypto News Morning Briefing—your essential rundown of the most important developments in crypto for the day ahead.

Welcome to the US Crypto News Morning Briefing—your essential rundown of the most important developments in crypto for the day ahead.

Grab a coffee as we examine Bitcoin’s (BTC) performance relative to the S&P 500, a benchmark for US stock market performance. With growing TradFi influence, Bitcoin’s dominance as an asset class is growing compared to traditional equities.

Crypto News of the Day: BTC/S&P 500 Ratio Hits All-Time High

Matthew Sigel, the head of digital assets research at VanEck, highlighted Bitcoin’s historic outperformance against the S&P 500.

Specifically, the Bitcoin/S&P 500 ratio hit an all-time high of $17.725 on May 8, reflecting the pioneer crypto’s growing dominance over traditional equities.

“All-Time High: Bitcoin/S&P 500 Ratio,” Sigel wrote.

This milestone aligns with broader market trends, including Bitcoin’s recent move to briefly surpass Google on market cap metrics, as indicated in a recent US Crypto News publication.

For Bitcoin, the surge comes amid growing institutional influence, and the resultant liquidity influx has prompted analysts to rethink the BTC cycle theory.

“It feels like it’s time to throw out that Bitcoin cycle theory… It’s more important to focus on how much new liquidity is coming from institutions and ETFs,” CryptoQuant CEO Ki Young Ju stated.

With growing adoption and prevailing jitters in the traditional markets, investors are turning to Bitcoin as a hedge against financial and US Treasury risks.

$3.5 Trillion Inflows to US Equity, Corporate Bond, and Treasury Funds

Reports indicate $3.5 trillion in cumulative inflows to US equity, corporate bond, and Treasury funds since 2007. Notably, $2.5 trillion of that surge occurred post-2020.

The Kobeissi data notes a strong investor appetite for US assets. However, Bitcoin’s ratio spike suggests a parallel shift, with some investors favoring decentralized assets amid global economic uncertainty, including inflationary pressures and geopolitical tensions.

US equity funds, capturing $1.2 trillion of the inflows, saw a $100 billion net outflow during the 2022 bear market.

According to Sigel, this indicates temporary risk aversion that Bitcoin seemingly sidestepped, as its long-term growth outpaced the Nasdaq over multiple timeframes.

“Bitcoin has outperformed the Nasdaq over 1 day, 1 week, 1 month, Year-to-date, 1 year, 2 years, 3 years, 5 years, 10 years,” Sigel stated.

Meanwhile, rising US Treasury yields, hitting 4.641% in early January 2025, marked the highest since May 2024. This dampened equity fund inflows, potentially driving investors toward Bitcoin as a hedge against traditional market volatility.

Chart of the Day

At an all-time high, the BRR index/SPX ratio means Bitcoin’s value has grown significantly more than the S&P 500. It indicates stronger investor confidence and outperformance in crypto over stocks.

Byte-Sized Alpha

Here’s a summary of more US crypto news to follow today:

Crypto Equities Pre-Market Overview