Bitcoin Struggles as Equities Outperform Despite Bullish Signals
Bitcoin BTC has lagged behind U.S. equities, both in absolute terms and relative performance. Adrian Fritz, chief investment strategist at 21Shares, attributes the divergence to macro pressures, investor sentiment, and what he calls a “panda market”—a bearish phase that falls short of a full crypto winter.
“Technically, we’ve entered a bear market,” Fritz told CoinDesk. Bitcoin has dropped more than 30% from its highs, falling below the 50-week moving average, a level that often signals a shift in market momentum. Altcoins have fared worse, with many losing 50% or more.
Over the past month, Bitcoin has declined 22%, sharply underperforming the S&P 500, down 2.5%, and the Nasdaq, down 4%. Fritz highlights the outsized influence of artificial intelligence on equities. “Exclude the Magnificent Seven, and the S&P isn’t up much. AI is clearly driving sentiment—it’s the shiny new toy on Wall Street,” he said.
This AI-driven focus may also be drawing capital away from crypto. While blockchain-AI applications—like content verification—have long been discussed, their practical adoption remains limited. “People feel AI’s impact daily. Blockchain hasn’t delivered that moment yet,” Fritz noted.
Leverage has further pressured the market. The October correction began with $20 billion in liquidations, and daily liquidations of $500 million are now common. According to Fritz, the downturn reflects excessive risk-taking, rather than fraud or major hacks. Even long-term holders are taking profits.
Gold continues to act as a safe haven, though it’s down roughly 10% from recent highs. “Bitcoin trades like a risk-on asset,” Fritz said. “It has gold-like properties, but its liquidity and 24/7 trading make it highly sensitive to sentiment.”
Technical indicators remain mixed. A bounce is possible, but failure to reclaim $102,000 could lead to further declines, with the 200-week moving average near $55,000 as a potential floor. Looking ahead, Fritz expects ongoing year-end volatility, with regulatory clarity and falling interest rates potentially supporting a Bitcoin rebound in 2026. “Bitcoin itself is solid. Altcoins need fundamentals, and AI-blockchain tokens may eventually attract attention, but for now, crypto is trailing equities.”
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