Bitcoin's Rally and Its Ripple Effect on Crypto-Linked Stocks

The corporate adoption of Bitcoin has evolved from a speculative experiment to a strategic asset-allocation move, with major firms treating the cryptocurrency as a core component of their treasuries. As of 2025, companies like Strategy Inc. (formerly MicroStrategy) hold over 628,946 BTC, while MARA Holdings and Twenty One Capital (XXI) maintain significant stakes of 50,639 BTC and 43,514 BTC, respectively according to data. This institutional embrace of Bitcoin has created a unique interplay between crypto price movements and stock market performance, raising critical questions for investors: How do corporate Bitcoin holdings influence stock valuations? And what does the evolving correlation between Bitcoin and equities mean for risk-adjusted returns?

The Shifting Correlation Between Bitcoin and Equities

Bitcoin's relationship with traditional markets has undergone a dramatic transformation since 2020. Initially viewed as a non-correlated diversifier, Bitcoin's correlation with the S&P 500 and Nasdaq indices has surged to as high as 0.88 in early 2025, driven by shared macroeconomic sensitivities such as Federal Reserve policy and global risk-on/risk-off sentiment. By mid-2025, this correlation stabilized around 0.5, indicating that both assets often moved in tandem during periods of market stress. However, a notable divergence emerged in late 2025: while Bitcoin declined amid weaker retail demand and competition from gold and silver, the S&P 500 remained positive. This divergence, historically a precursor to Bitcoin bottoms (e.g., July 2021, September 2023), suggests that crypto-linked stocks may face unique pressures distinct from broader equity markets.

Corporate Bitcoin Holdings and Stock Performance: A Volatile Dance

The stock prices of Bitcoin-focused corporations have mirrored-and often amplified-Bitcoin's price swings. Strategy Inc. (MSTR), for instance, leveraged $1.4 billion in debt to purchase additional Bitcoin in March 2024, driving its stock up 170% while Bitcoin rose only 64%. This outperformance highlights how strategic financial engineering can decouple stock returns from underlying crypto prices. Conversely, MARA Holdings (MARA) has seen its shares drop 53% since October 2025, outpacing Bitcoin's 31% decline during the same period. MARA's struggles stem from rising Bitcoin mining costs and operational challenges, underscoring that not all crypto-linked stocks are equally insulated from sector-specific risks.

The disparity in performance reflects divergent business models. Strategy, with a market cap of $50.6 billion and Bitcoin holdings valued at $56.7 billion, operates at a mNAV ratio that has drawn investor scrutiny. Its stock, however, benefits from non-Bitcoin revenue streams, such as software subscriptions, which MARA lacks. Meanwhile, MARA's pivot to energy production and data centers aims to reduce reliance on Bitcoin mining, yet its stock remains vulnerable to crypto price volatility.