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Bitcoin surged 10% to $66,800 just a day after a 17% crash, while the S&P 500 took only a 0.47% upside, causing Wall Street to take notice. Popular TV host Jim Cramer points to the phenomenon of "leverage rotation," saying investors sold their stocks to capitalize on Bitcoin.
The setup shows a bigger change — Bitcoin is separating itself from regular markets when things get stressful. Gold and silver also rose, but neither matched BTC's upside pull. Crypto is making a comeback after losing ground in a liquidation death spiral, and equities are feeling the impact.
The result is not just an anomaly — it is a sign that capital may be exiting stocks for something riskier this Friday.
Bitcoin becomes Wall Street's leverage
According to Cramer, the rally on Bitcoin (BTC) showed just how much leverage is built into the system. His theory is that investors are offloading their S&P 500 positions to put their money into Bitcoin instead.
Whether it is meant as serious criticism or just a general assessment, the data seems to back up his point. And it is not just stocks taking a hit.
Bitcoin is now traded like its own asset class, especially when liquidity tightens. Risk-on days used to lift all boats. Not this time. While Bitcoin soared, capital rotated violently out of equities.
Even traditional safe havens like gold (+2.77%) and silver (+5.68%) could not match BTC’s magnetism.
Looking at the big picture, the S&P 500 had been holding on near record highs above $7,000 for a while, but then it took a big dip in February. On Tuesday, it had its worst day since October, dropping below its short-term support level.
The idea that Bitcoin would eventually become separate from traditional markets during big economic problems is now happening, though in a weird way.
Gamza Khanzadaev
Alex Dovbnya
Tomiwabold Olajide
Godfrey Benjamin