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Why crypto surged while stocks fell: The regulatory breakthrough changing everything

Why crypto surged while stocks fell: The regulatory breakthrough changing everything
Market activity today unfolded under heavy geopolitical tension, with the Iran conflict driving volatility across global risk assets. Investors traded in the fog of war, where headlines about supply disruptions triggered rapid portfolio shifts. Asian equities weakened, with Japanese and Hong Kong futures pointing lower, while Australian stocks fell more than one per cent. US S&P 500 contracts slid 0.9 per cent as uncertainty mounted. Oil extended gains for a second session on Middle East supply concerns, pushing inflation expectations higher. Bond markets reacted with the 10-year Treasury yield reaching 4.16 per cent. Gold held near US$5,192 per ounce, though its stability reflected caution more than conviction. Traditional markets moved in lockstep with conflict narratives.

Against this stress, cryptocurrency gained 0.64 per cent, lifting the total market cap to US$2.39T. Crypto showed a negative 37 per cent correlation with the S&P 500 and a negative 53 per cent with gold, signalling decoupling from traditional flows. Digital assets responded to regulatory progress and institutional validation instead. A White House announcement on March 11 ended the prior administration’s war on crypto and flagged a potential market bill by April. This shift reduced a major overhang on institutional participation. Markets priced in higher odds of favourable US legislation, creating a fundamental tailwind that outweighed geopolitical headwinds.

Institutional moves reinforced this optimism. Mastercard expanded its Crypto Partner Program to include Ripple and Binance, validating real-world use cases for payments and custody. Such partnerships lower adoption barriers for enterprise clients. Speculative capital also rotated into higher-beta altcoins. The Altcoin Season Index rose 2.56 per cent, while low-cap tokens like Origin Protocol saw volumes surge over 2200 per cent without project-specific news. Excess liquidity chased asymmetric opportunities in a more permissive regulatory environment. Institutional groundwork and retail speculation combined to create self-reinforcing momentum that kept crypto buoyant as equities faltered.

Technical structure now guides the near-term path. The market faces resistance at the 23.6 per cent Fibonacci level of US$2.4T. A decisive break above, especially on a weekly close, could target US$2.46T. Failure to hold US$2.33T, the 50 per cent Fibonacci level, might renew selling pressure and trap prices in consolidation. These levels reflect collective psychology around regulatory clarity as a structural shift. The Fibonacci framework gives traders a common language for managing risk at this inflection.

Negative correlations with traditional assets reveal an important insight. Crypto’s move appears to be dollar- and liquidity-driven rather than conventional risk-on. When equities fall amid war fears, and gold holds steady while crypto rises amid regulatory news, maturity is evolving. Digital assets increasingly respond to their own catalysts, especially policy developments affecting compliance and institutional access. This does not make crypto immune to macro shocks, but the market now weighs regulatory signals more heavily than short-term geopolitical noise. The White House pivot represents the most significant such signal in years.

Sustainability depends on follow-through. Concrete legislative progress by mid-April is needed to maintain bullish momentum. Traders should watch ETF flows and whether altcoin volume persists. The next US CPI release could reintroduce inflation concerns affecting all risk assets. The current setup favours cautious optimism. Regulatory momentum provides a foundation, partnerships add utility, and technical levels offer clear risk parameters. The key question is whether altcoin momentum holds if Bitcoin fails to break US$2.4T. A rejection might trigger consolidation without invalidating the broader regulatory thesis.

I view this regulatory inflection as a structural game-changer. Years of ambiguous policy discounted digital asset valuations, especially for institutional capital needing compliance clarity. The White House’s commitment to an April bill begins removing that discount. This does not guarantee immediate adoption, but it shifts the probabilities toward greater integration with traditional finance. Mastercard partnerships exemplify this integration. When payment giants embrace crypto rails, they build infrastructure lasting beyond any news cycle. Speculative altcoin rotations reflect a market testing new permissiveness, typical in early regulatory transitions where uncertainty drives broad experimentation.

Negative correlations with equities and gold support crypto maturing into a distinct asset class. Past crises saw digital assets move with conventional risk flows. Today’s divergence suggests a nuanced reality where investors separate geopolitical risk from regulatory risk. When regulatory conditions improve while geopolitical tensions worsen, decoupling emerges. This does not promise permanent macro insulation, but policy developments can outweigh short-term geopolitical noise in determining direction.

In conclusion, traditional assets grappled with war-related uncertainty, while crypto advanced amid regulatory clarity. The 0.64 per cent gain to US$2.39T, with negative correlations to equities and gold, reflects a market responding to its own catalysts. Policy shifts, institutional partnerships, and speculative rotation created a bullish impulse now testing technical levels. A break above US$2.4T could open the path to US$2.46T, while a break below US$2.33T signals consolidation. The broader narrative remains cautiously optimistic. Regulatory momentum supports sustained institutional adoption even as short-term trading stays headline-sensitive. The coming weeks will show whether Washington’s promises become legislative reality, but crypto’s divergence underscores its evolving role in the global financial system.

 

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
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S&P 500 correlation hits 60 per cent while Bitcoin tests critical support

S&P 500 correlation hits 60 per cent while Bitcoin tests critical support

The crypto market declined 0.65 per cent over the past 24 hours, bringing its total valuation to US$2.22 trillion. Bitcoin led the downturn as institutional sellers aggressively exited positions. Data shows a strong 60 per cent correlation with the S&P 500, indicating a shared macro-driven move across asset classes. Investors observe this connection to understand how traditional finance influences digital assets. Bitcoin’s dominance currently sits at 57.88 per cent, highlighting its role as the market leader.

The core driver remains continued institutional distribution as large holders reduce exposure. This shift means capital leaves the ecosystem at a significant rate. The primary reason for this drop involves sustained institutional outflows from the United States of spot Bitcoin exchange-traded funds. SEC filings revealed net selling of these shares, equivalent to roughly 25,000 BTC, in the fourth quarter of 2025. This unwinding of institutional positions creates persistent sell pressure that weighs heavily on prices. Capital exits the regulated gateway for institutional crypto exposure, undermining a key pillar of recent market support. Traders watch daily ETF flow data closely because a consecutive string of net inflows would stabilise Bitcoin and the broader market.

The secondary reasons for the decline include spillover from a risk-off move in tech equities and persistently negative market sentiment. Readings reflect extreme fear in the market with the Fear and Greed Index at 11. This low number suggests investors feel panic rather than opportunity. Crypto moves with traditional risk assets and does not decouple during these periods. A sell-off in tech stocks contributed to the risk-off environment, and uncertainty around AI advancements, such as the Anthropic Claude launch, fuelled this sentiment. This sentiment compounds the extreme fear in crypto and amplifies the downturn.

Negative macro sentiment and equity weakness work together to push values lower. Investors should watch for stabilisation in major tech indices such as QQQ and SPY as a precursor to relief in crypto. Sentiment shifted from AI disruption fears to AI opportunity after the AMD Meta deal. Battered software stocks also stabilised as investors reconsidered the immediate threat of AI replacing existing enterprise systems. This stabilisation in tech could help crypto if the correlation holds true.

The near-term market outlook depends on Bitcoin defending the US$2.17 trillion total market cap, which marks the yearly low. The Relative Strength Index at 36.96 suggests the market is approaching oversold territory but has not yet reached it. A break below US$2.17 trillion could trigger another leg down toward the 200-day moving average near US$3.07 trillion, according to the provided technical analysis. Conversely, a hold above support combined with a return of positive ETF flows could set the stage for a technical bounce.

The key trigger to watch involves the release of daily United States Bitcoin ETF flow data. A reversal hinges on sustained positive ETF net flows. Without this change, the bearish pressure will likely continue. The downturn fuels itself through institutional capital rotation out of Bitcoin ETFs, and correlated weakness in tech stocks exacerbates the pressure. Technical indicators show the market becomes oversold, but a definitive bottom requires a shift in institutional behaviour.

Broader economic factors also play a critical role in shaping this landscape. Policy uncertainty emerged as a new 10 per cent global United States tariff came into effect on 24 February. Markets appeared to have largely priced in the impact following recent Supreme Court rulings. Consumer confidence supports the S&P 500 after the Consumer Confidence Index rose to 91.2 in February. This number beat economist predictions of 87.4 and provides some stability to equities.

Energy and geopolitics influence the picture as crude oil prices eased by approximately one per cent. Iran indicated readiness to negotiate ahead of nuclear talks scheduled for Thursday. Brent futures settled at US$70.77 per barrel, which helps reduce inflationary fears slightly. Commodities and Treasury yields show mixed signals that affect risk appetite. Gold prices pulled back slightly on 24 February to approximately US$5,150 per ounce as profit-taking occurred after Monday’s record-setting rally. Indian-based prices for 24K gold reached a new high of ₹1.62 lakh per 10 grams on 25 February, driven by continued safe-haven demand. This divergence shows that investors are seeking safety in physical assets as trading volumes adjust in Western markets.

Treasuries indicate steady yield expectations, as the benchmark 10-year United States Treasury yield held near 4.04 per cent. The two-year yield ticked up slightly to 3.459 per cent, which signals short-term rate expectations remain firm. Currency markets show the United States Dollar firmed while the Japanese Yen weakened. The USD/JPY pair pulled above 155.25, reflecting strength in the greenback against major peers.

A strong dollar often pressures risk assets like crypto because it reduces the appeal of non-yielding investments. Sentiment shifted from AI disruption fears to AI opportunity after the AMD Meta deal. Battered software stocks also stabilised as investors reconsidered the immediate threat of AI replacing existing enterprise systems. This stabilisation in tech could benefit crypto if the correlation holds. The business landscape evolves rapidly, and these shifts matter for digital asset valuations. Investors must weigh the tariff impacts against the gains in consumer confidence. The interplay between oil prices and gold demand shows a complex global picture.

Market outlook remains bearish under current conditions. Only a sustained shift in the above-mentioned areas will reverse the current trend. The market waits for clarity on institutional intent and macro stability. Until then, the pressure remains on the downside.

 

Source: https://e27.co/sp-500-correlation-hits-60-per-cent-while-bitcoin-tests-critical-support-20260225/

 

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j

While S&P 500 struggles, crypto’s low correlation to gold and stocks attracts institutional attention

While S&P 500 struggles, crypto’s low correlation to gold and stocks attracts institutional attention

The crypto market’s modest advance of 0.51 per cent to a total capitalisation of US$2.3T over the last 24 hours represents more than a simple price fluctuation. It signals a market beginning to price in a fundamental shift in its operating environment. This move appears internally driven rather than a reflexive follow-through from traditional finance. Correlation data support this view.

The crypto market’s relationship with the S&P 500 is negligible at 0.8 per cent, while its tie to Gold is low at 15 per cent. This decoupling suggests capital is responding to crypto-specific catalysts, primarily a growing conviction that the United States regulatory landscape may finally be evolving. This moment feels familiar yet distinct. We have seen false dawns before, but the current momentum behind the CLARITY Act carries a different weight, one that markets are increasingly willing to bet on.

The primary engine of this cautious optimism is the rising likelihood that the CLARITY Act will become law. Prediction market Polymarket now reflects an 85 per cent chance of passage, a figure cited by industry leaders like Ripple CEO Brad Garlinghouse, who points to a potential timeline by April 2026. This is not merely a political statistic. It represents a potential removal of the single greatest overhang on institutional capital allocation.

A clear legal framework does more than just provide compliance checklists. It enables the construction of long-term valuation models that investors could not build under a regime of enforcement by litigation. The market is actively discounting this reduced uncertainty.

A critical perspective remains essential. Legislative odds can shift rapidly. True progress requires watching for concrete actions: official committee markups, bipartisan statements of support, and the actual text of proposed amendments. The next few weeks will provide crucial data points to separate genuine momentum from speculative noise.

While regulatory hopes provide the macro backdrop, capital is expressing its views with notable selectivity. The broader market’s slight gain masks a clear rotation into specific narratives. The Layer 1 category advanced 0.65 per cent, outperforming the aggregate.

Within that, infrastructure and artificial intelligence tokens demonstrated significant strength. Enso posted a gain of 35.74 per cent while Allora advanced 12.9 per cent. This pattern reveals a trader psychology that is opportunistic but not yet broadly confident. Participants are seeking alpha in defined thematic buckets rather than deploying capital indiscriminately. Sentiment data corroborates this cautious stance.

The Fear and Greed Index, while improving from a reading of 8 to 11, remains firmly in Extreme Fear territory. This combination of selective bullishness and pervasive caution defines the current tape. It suggests a market building a foundation for a potential relief rally, but one that remains vulnerable to a shift in the regulatory narrative or a broader macro shock.

The near-term technical pathway for the market hinges on two clear levels. On the upside, the total market capitalisation faces immediate resistance at the 78.6 per cent Fibonacci retracement level of US$2.35T. A sustained break above this threshold could signal a meaningful short-term trend reversal, inviting further speculative interest.

On the downside, Bitcoin’s ability to hold the US$66,000 support level is paramount. A decisive break below this price could quickly reignite the bearish sentiment that fueled the market’s 27.5 per cent decline over the past month.

These technical levels are not arbitrary. They represent the collective memory of recent price action and the current balance between buyers and sellers. Monitoring daily closes relative to the US$66,000 to US$67,000 zone for Bitcoin, alongside updates to the CLARITY Act’s legislative progress, provides a practical framework for assessing short-term direction.

The market is asking a simple question: can regulatory optimism overcome technical overhead and fragile conviction

This crypto-specific drama unfolds against a backdrop of traditional market stress, which further highlights the asset class’s evolving independence. Major US stock indices declined on Thursday, February 19, 2026, with the S&P 500 slipping 0.28 per cent to close at 6,861.89. The drivers were classic macro headwinds: geopolitical tensions between the US and Iran pushed oil prices higher, with Brent crude settling at US$71.66 a barrel, a six-month high.

Concurrently, concerns over private credit liquidity resurfaced after a major fund halted redemptions, sending shares of alternative asset managers such as Blackstone and Apollo Global Management down by more than five per cent. This news struck at the heart of the US$1.8T private credit market.

Even better-than-expected labour data, which showed initial jobless claims falling to 206,000, well below the forecast of 227,000, could not offset these fears. The data briefly pushed the 2-year Treasury yield to 3.468 per cent, reflecting complex investor calculations about growth and inflation.

In this environment, crypto’s low correlation is not just a statistical curiosity. It represents a potential portfolio diversification benefit that institutional investors are beginning to seriously evaluate, provided the regulatory path forward becomes clearer.

The current market posture, therefore, is one of cautious optimism anchored by a tangible, though not yet realised, reduction in regulatory risk. For those of us who believe in the long-term promise of decentralised systems, the path forward requires more than just favourable legislation. It demands building infrastructure and applications that deliver undeniable utility.

The current price action is a hopeful signal, but the real work of integrating these technologies into the global financial fabric continues, independent of daily price fluctuations or political odds. The market’s next move will be a test of whether this foundational work is beginning to be recognised and valued by a broader set of participants.

 

Source: https://e27.co/while-sp-500-struggles-cryptos-low-correlation-to-gold-and-stocks-attracts-institutional-attention-20260220/

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j