Bitcoin (BTC-USD) has often been hyped as an inflation hedge or as an alternative investing class, an opportunity to diversify a portfolio. However, evidence continues to mount, especially in the recent market downturn, that crypto holds a high correlation with stocks (SP500). This connection is evidenced by the fact that both bitcoin and equities grinded higher in the easy money era of 2020-2021, and now both are facing cyclical downturns as financial conditions tighten and liquidity dries up. "The correlation between bitcoin and equity indices has remained high and will continue to do so unless bitcoin becomes widely used as a medium of payment - which looks unlikely to happen soon," Morgan Stanley analyst Sheena Shah wrote in a note May 10. For some context, the rolling 120-day correlation between the S&P 500 index (SP500) and bitcoin (BTC-USD) was recently standing at 0.60, the highest reading since the series began
