Wintermute: BTC Transaction Trend More Bearish than Stock Index, Upward Narrative Premium No Longer Exists

On November 14th, Wintermute's latest report indicated that the correlation between Bitcoin and the Nasdaq Index remains as high as 0.8. However, Bitcoin's trading trend is more bearish than that of the stock index. It shows a much greater response to market pessimism than to optimism. On trading days when the stock market declines, the decline of BTC is generally larger than that of the stock index. On the contrary, when the stock market rises, Bitcoin's increase is smaller. This pattern was last observed during the bear market of 2022. Wintermute stated that there are two main potential factors leading to this phenomenon: Throughout most of 2025, funds that usually flow into the cryptocurrency space, including new token launches, infrastructure upgrades, and retail participation, have shifted to the stock market. Large-cap tech companies have become the focus for institutions and retail investors seeking high beta coefficient/high growth. When global risk sentiment changes, Bitcoin remains connected to it. However, it fails to benefit proportionally when optimism returns. It is more like the "high-beta tail" of macro risks rather than an independent narrative. The downside beta effect still exists, but the upside narrative premium no longer exists. Today, the liquidity conditions of cryptocurrencies are different from those in previous risk cycles. The supply of stablecoins has stabilized. ETF fund inflows have slowed down, and the market depth of trading platforms has not yet recovered to the levels of early 2024. This fragility will amplify the negative reaction during a stock market pullback. As a result, Bitcoin's participation in declines remains higher than in gains, exacerbating this performance deviation.