Bitcoin extends rebound with year-to-date gain at 50%; defies macro peril

Concerns about further interest-rate hikes, a fizzling stock rally and a US crypto crackdown all suggest Bitcoin and other tokens should be beating a hasty retreat. Instead, they’re extending their 2023 rebound.

Bitcoin’s year-to-date gain has now reached 50% after a further jump in February, contrasting with a retreat in global equities this month courtesy of a macroeconomic environment replete with growth and inflation concerns.

This divergence has dented a positive correlation between shares and crypto that sprouted in the pandemic. A 40-day correlation between Bitcoin and the S&P 500 has slid below 0.3 to the lowest since 2021 from a May record above 0.8. A reading of 1 implies assets are fluctuating in lockstep and minus 1 signifies the opposite.