In light of the severe turmoil sweeping global markets, it is increasingly clear that what we are witnessing is not merely a transient corrective move but a broad repricing of risk across the worlds of technology and artificial intelligence. These pressures are now spilling directly into digital assets — foremost among them Bitcoin, which is currently trading at $83,150. The volatility surrounding Big Tech, combined with uncertainty over Federal Reserve policy, has triggered a deep portfolio reshuffle. This is reflected in Bitcoin’s rising correlation with the Nasdaq, now at its highest level in months — a correlation trend similar to the dynamics EBM explored in its analysis of Europe’s shifting corporate strategy in a high-rate environment (Internal Link 1).
This increasing correlation suggests that Bitcoin has temporarily lost part of its identity as an alternative, uncorrelated asset. Instead, it is now moving almost entirely in sync with traditional market sentiment. The sharp 4% drop in the Nasdaq during Thursday’s session — despite Nvidia reporting strong results and offering optimistic forecasts — illustrates the market’s deep concern about the massive costs associated with building AI infrastructure. Investors are no longer focused only on quarterly earnings; they are questioning whether such profits can be sustained amid an aggressive race for data-center capacity and companies’ ability to manage long-term debt. This connects closely with the broader investment-risk themes EBM has highlighted in its reporting on AI capital expenditure and the strain on global tech valuations (Internal Link 2).
From my perspective, this concern is justified. The unprecedented rise in capital expenditure is pushing many major tech players closer to a speculative model rather than one grounded in predictable cash flow. And just as the Nasdaq entered this downward spiral, Bitcoin mirrored the move — falling below $86,000 for the first time since April. This is yet another sign that investors are treating Bitcoin as a high-risk asset rather than a safe haven.
At the same time, market sentiment remains dominated by fears of overstretched valuations. To be clear, I do not believe this reflects an impending crash, but rather a clearly defined bubble — a diagnosis I largely agree with. Yet bubbles do not always burst quickly; some inflate for years before reaching an inflection point. In this context, diversification into scarce assets such as gold appears logical, especially as expectations of potential wealth taxes rise — an issue arguably more concerning than monetary tightening. As EBM noted in its coverage of Europe’s evolving fiscal pressures and the shifting burden on high-net-worth capital, tax policy is becoming a central driver of investment behaviour (Internal Link 3). Higher wealth taxes could easily push capital toward alternative havens, including Bitcoin and gold.
Market sentiment shifted again after the release of the U.S. September jobs report, which surprised to the upside with 119,000 new jobs. This prompted traders to believe that the Federal Reserve may not be ready to ease its monetary stance as anticipated. Futures markets quickly priced in only two rate cuts by January 2026 — a clear sign of renewed caution among equity and digital-asset investors. In my view, this reaction is exaggerated. The United States’ chronic fiscal deficit and mounting debt levels will ultimately push the Fed toward a more accommodative position, whether or not the central bank attempts to delay signalling that shift publicly. This ties directly to the macro-liquidity themes EBM explored in its analysis of central bank policy and its impact on European capital markets (Internal Link 4).
Meanwhile, the massive spending on AI — particularly on data-center infrastructure — has added a new layer of uncertainty. Recent commentary from tech analysts describing the “speculative nature” of these investments strongly echoes the dot-com bubble, when infrastructure expansion far outpaced the market’s ability to monetise it. Investors are not alarmed by spending itself, but by the absence of clarity on the long-term payoff. As a result, the Nasdaq has fallen more than 7.8% from its October peak, triggering a rapid exit from high-risk assets. This exodus has pushed Bitcoin’s 30-day correlation with the Nasdaq to roughly 80%, reflecting behaviour more typical of tech-stock trading than alternative-asset positioning. Yet this correlation does not change Bitcoin’s fundamental characteristics as a scarce, inflation-resistant digital asset over the long run — a point explored in EBM’s recent outlook on the future of digital assets in institutional portfolios (Internal Link 5).
Taking all this into account, panic sellers may ultimately regret their decisions, as liquidity could improve again with the ongoing U.S. debt crisis. Additionally, President Donald Trump’s proposed stimulus agenda — including so-called “tariff distributions” — could introduce a fresh liquidity source that would favour alternative assets. In my opinion, any return to expansionary fiscal policy in the United States would deliver an immediate positive impulse to Bitcoin and restore its upward trajectory.
In conclusion, what we are witnessing is a clash between two powerful forces: an economically strained reality that is heightening investor caution, and massive technological ambitions that are absorbing capital at an accelerating rate. Between these opposing dynamics, Bitcoin has become a mirror of broader market sentiment — falling when fear dominates, rallying when liquidity improves. My outlook remains unchanged: the short term will be volatile, but the medium and long term still offer strong positive signals. The fundamentals underpinning Bitcoin’s growth remain intact, while traditional markets are entering a period of uncertainty that could make crypto assets far more attractive than they appear today.
