Bitcoin is aligning more with the volatility of struggling software stocks.

Software stocks are under mounting pressure from the rise of AI, and one analyst notes that Bitcoin is essentially “open-source software.”

Bitcoin has increasingly been trading like a software stock, with its recent correction unfolding alongside a broader software selloff.

The connection between Bitcoin and software equities has strengthened. On a 30-day rolling basis, Bitcoin’s correlation with the iShares Expanded Tech-Software ETF (IGV) sits at a high 0.73, according to ByteTree. Year to date, IGV is down roughly 20%, while Bitcoin has declined 16%.

IGV is heavily weighted toward software and services leaders including Microsoft (MSFT), Oracle (ORCL), Salesforce (CRM), Intuit (INTU), and Adobe (ADBE).

While the broader tech sector remains relatively resilient—the Nasdaq 100 (QQQ) is only about 4% below its record high—software stocks have taken the brunt of selling pressure. Bitcoin is increasingly moving in line with this weaker segment rather than the wider market.

The reason is clear: AI. Rapid progress toward artificial general intelligence (AGI) is being seen as an existential threat to many software companies.

“There’s no doubt Bitcoin has been caught up in the technology selloff,” said ByteTree. “At its core, Bitcoin is an internet stock. Software stocks have been the latest casualty, and over the past five years, Bitcoin has closely mirrored their performance.”

ByteTree notes that the average technology bear market lasts about 14 months. With this downturn starting in October, pressure could continue through much of 2026, though a resilient economic backdrop may still offer support for Bitcoin.