Five-year data debunks the myth of a link between Bitcoin and oil: why BTC ignores the collapse of Brent
This week, Brent crude oil experienced its deepest weekly decline in recent months, plunging 9% and breaking through the $80 per barrel level. However, Bitcoin, contrary to the expectations of many market participants, responded to this event with a minimal decline of just 1%. This price divergence forces us to reconsider the established view of a close correlation between the black gold market and the digital asset.
Many traders and analysts have long perceived a drop in energy prices as a signal for a subsequent rebound in the cryptocurrency market. However, as data from the past five years shows, this connection is nothing more than an illusion.
Correlation Close to Zero
Mathematical analysis over a five-year period revealed a correlation coefficient between Bitcoin and oil of just 0.036. For reference: a value of +1 indicates a perfect match in trajectories, while -1 indicates a strictly opposite movement. The current figure of 0.036 is a statistical zero, which irrefutably proves the absence of any stable relationship between these assets.
Even when broken down into different market phases, the picture does not change. In calm periods, the correlation is +0.05; in times of high volatility, it is -0.02. Over the last 30 days, when oil fell sharply, the indicator dropped to -0.21, pointing to a short-term divergence but not a systemic link.
Why Does the Myth Persist?
The logic of "oil gets cheaper → mining becomes cheaper → BTC rises" does not work in practice. Electricity is just one factor for miners, and its cost is not decisive for the exchange rate. Moreover, the network's hashrate continues to grow confidently despite the decline in hydrocarbon prices. This speaks to miners' fundamental belief in the industry's long-term prospects.
Historical examples confirm this. When Brent soared to nearly $119 at the end of March, Bitcoin did not fall but instead showed enviable stability. Long-term holders, on the contrary, increased their positions, paying no attention to expensive fuel.
The True Source of Pressure
The current pressure on Bitcoin comes not from the oil market but from the derivatives market. Open interest in BTC futures has risen from $21.83 billion to $23.45 billion, and the funding rate has turned negative. This means that bears are dominating, actively opening short positions and paying to maintain them.
The paradox of the situation is that this creates ideal conditions for a short squeeze. Any random upward impulse will force bears to panic-close their positions, triggering a cascading rise. But this rise will be purely technical, not fundamental, and will not last long.
My professional conclusion: As long as Brent trades around $79 and BTC holds the $62,800 level (roughly half of its all-time high), looking for signals for cryptocurrency in the barrel price is a waste of time. The next powerful impulse for Bitcoin will be dictated not by oil, but by the decisions of the U.S. Federal Reserve and the state of the derivatives market.