The cryptocurrency market is on the brink of a serious test. My analysis shows that Bitcoin (BTC) risks becoming the main victim of a potential reversal in the U.S. stock market. This conclusion is drawn from observations by several independent analysts, whose calculations, published ahead of U.S. Independence Day, form a worrying chain: from a century-long stock market cycle through record capital inflows into U.S. stocks to the critical dependence of the BTC price on the dynamics of the S&P 500.
The Century-Long Stock Market Cycle: The Final Euphoria
An analysis of the long-term dynamics of the S&P 500 index reveals a recurring century-long pattern: a technology boom lasts about 24–25 years, followed by a decade of stagnation. Vivid examples include the electronics and automation boom (1942–1966, growth of 2536%) and the PC and internet boom (1975–2000, growth of 2665%). In both cases, this was followed by nine years of sideways movement. The current cycle, which began in 2009 with the era of smartphones, e-commerce, and AI, would logically end around 2033. This means the bull market has about seven years left, but history shows that the steepest part of the growth occurs in the final, euphoric stage. It is at this point that markets are most vulnerable to shocks.
Record Capital Inflows: The Last Straw?
The current situation in the U.S. stock market is characterized by unprecedented demand. Cumulative inflows from global investment funds since the start of the year have reached about 2.5% of their total assets under management. This figure has more than doubled since May and significantly exceeds the average level for 2002–2025, when an outflow of about 0.3% was recorded by this date. The pace of inflows since the start of the year has already surpassed the full-year result typical for the median half of years since 2002. Such demand is a clear sign of a late-stage cycle, when capital enters the market in search of final profits.
Bitcoin — A Hostage of the Stock Market
My detailed analysis confirms that the resilience of all commodity and crypto assets directly depends on whether U.S. securities continue to rise. If the stock market fails to hold at current levels, Bitcoin will likely be closer to the $10,000 mark, gold will retreat to $3,000 per ounce, and WTI oil will fall below $50 per barrel.
What is particularly alarming is Bitcoin's current underperformance. In the year leading up to July 4, its total return lost about 40%, while the S&P 500, gold, and copper rose by 21–25%, and oil remained roughly flat. This shows that the cryptocurrency is weakening even against the backdrop of a strong stock market. Any reversal in the stock market will hit it the hardest, and the current underperformance makes BTC especially vulnerable at the first sign of a change in sentiment.
Expert Comment: The cryptocurrency market, and especially Bitcoin, is currently in an extremely vulnerable position. As long as the U.S. stock market continues to rise due to record capital inflows, BTC may follow it upward. But as soon as euphoria turns to panic — which is inevitable within the century-long cycle — Bitcoin, lacking its own fundamental drivers, risks collapsing significantly more than traditional assets. Investors should be prepared for a scenario of a drop to $10,000, especially if the macroeconomic situation deteriorates.