Crypto Market Thrives As Investors Pull Out of Stocks: Know Why

The latest crypto market metrics have set off a tidal wave of optimism by signaling that investors are shifting focus from stock to risk assets like BTC and Ether. While Bitcoin is decoupling from the S&P 500, stablecoin inflows are on the rise. As a result, market experts like John E. Deaton remain bullish over future prospects despite the ongoing turmoil.

Investors Flock To Crypto Market: Here’s What Data Says

An X post shared by analyst Ali Martinez on April 5 revealed that capital inflows across the crypto market have surged 350% in just two weeks. As per the data, inflows rose from $1.82 billion to $8.20 billion, which pointed to renewed market interest in risk assets.

Despite the broader market turmoil caused by Donald Trump’s announcement of reciprocal tariffs, investors anticipate a bullish future for Bitcoin, Ether, and other crypto. The data also signals that investors are securing funds by investing in stablecoins rather than stocks as global markets are facing pressure amid trade war tensions.

Bitcoin Decouples From S&P 500

On the other hand, an X post by DataDash revealed that Bitcoin is decoupling from the S&P 500. BTC and S&P 500 have shown correlated action, and following the Elliott Wave Theory, the assets reached their wave 5 highs earlier this month.

However, a recent shift in the market sentiment since April 2 has ignited a massive tide of speculations. The S&P 500 witnessed a steep decline of over 10%, breaking key support at 5500 and yet to show signs of a clear reversal to date. Meanwhile, BTC price is down slightly over 5% from its high and is still holding above support levels. This dynamic further underlines signs of capital rotation wherein funds flow out of equities and move to the crypto market.

Additionally, this metric also indicates that a paradigm shift in market sentiment could occur shortly ahead despite the ongoing turbulence. The robust stablecoin inflows have only added to the chances of a bull market ahead. Now, market participants are eagerly awaiting risk assets to digest trade war tensions.

BTC Price Stays Strong, Crypto Market To Follow?

Meanwhile, despite the bloodbath on Wall Street, BTC price maintained trading above $85K and prevented any major losses. The flagship crypto consolidated within the $81K to $84K range over the past day. Bitcoin’s resilient action in comparison to equities has left investors scratching their heads. Many experts even believe that the alt sector could mimic such a movement.

A recent X post by attorney John E Deaton further shows intriguing data that underlines investors’ shift of interest towards risk assets. The post indicated that while $3.25 trillion was erased from the U.S. stock market in just a day, $5.4 billion was added to the cryptocurrency sector.