Bitcoin News Today: Institutional Risk Appetite Shifts to Equities, Exposing Bitcoin's High-Beta Weakness

Bitcoin's correlation with the NASDAQ-100 index has intensified during market downturns, according to a recent analysis by crypto trading firm Wintermute. While Bitcoin (BTC) and the NASDAQ maintain a strong correlation of 0.8, the performance skew between the two assets has turned predominantly negative since the Federal Reserve began easing rates in September. This dynamic highlights Bitcoin's "high-beta tail" behavior, where it mirrors equity market declines more sharply than rebounds. The trend, which has reached its lowest 365-day rolling level of positive skew since the 2022 bear market, reflects shifting institutional and retail attention toward equities, Wintermute noted.

The firm attributed the asymmetry to a broader reallocation of US dollar risk appetite from crypto to equities in 2025. Bitcoin's 18% decline since the Fed's rate cuts, compared to the NASDAQ-100's 3.7% gain, underscores this shift. Reduced ETF inflows, stablecoin issuance plateaus, and compressed market depth have further exacerbated Bitcoin's performance gap. Wintermute also observed that such negative skew typically emerges during bearish cycles, yet Bitcoin remains near all-time highs, suggesting investor exhaustion.

Meanwhile, American Bitcoin Corp (ABTC), a Trump-linked firm, reported a 6.5% premarket stock drop despite doubling Q3 revenue to $64.2 million. The company's gross margin expanded to 56%, and Bitcoin reserves grew to 3,418 BTC since April. However, the stock's volatility and proximity to its 52-week low fueled caution among investors. Eric Trump, co-founder, emphasized Bitcoin's transformative potential, while CEO Asher Genoot highlighted the firm's hybrid model of mining and treasury operations.

Institutional interest in crypto remains mixed. RockToken introduced structured investment plans offering Bitcoin, Ethereum, and USDC exposure to retail and retirement investors. These contracts, ranging from $199 to $149,995, aim to simplify crypto participation through transparent yield distribution. The firm's CEO, Nicholas Aitken, noted growing demand for crypto as part of diversified portfolios, aligning with broader institutional adoption trends.

Conversely, the broader crypto market faced sustained sell-offs. Bitcoin traded near $95,000, with Ethereum and XRP sliding below $3,200 and $2.30, respectively. ETF outflows accelerated, with $870 million leaving US-listed BTC spot ETFs on Thursday alone. Grayscale's GBTC led with $318 million in outflows, while Ethereum ETFs saw $260 million in redemptions. Weak derivatives markets and declining open interest further signaled fragile retail demand.

A new institutional access point emerged as Anchorage Digital partnered with BOB (Build on Bitcoin) to provide custody services for Bitcoin-native DeFi. This collaboration, backed by a U.S. federally chartered bank, aims to unlock $250 million in yield opportunities for institutional investors. Anchorage's CEO, Nathan McCauley, highlighted the potential for Bitcoin's security to merge with Ethereum's DeFi capabilities, creating regulated pathways for institutional participation.

The interplay of market dynamics-from equities-driven risk appetite to institutional infrastructure-underscores the evolving role of Bitcoin in global portfolios. As volatility persists, investors and firms alike are recalibrating strategies to balance exposure, yield, and regulatory alignment.