Bitcoin Price Temporarily Under Pressure Due to AI Hype, But Recovery Expected

The Bitcoin price currently stands at $63K, a rise of 1.3% in the past 24 hours. Yet Bitcoin lags behind the stock markets, which are reaching record levels. According to Schwab and Hashdex, however, this discrepancy is temporary.

Bitcoin is available at OKX and Bybit.

Capital flows towards AI and IPOs

Hashdex explains that investors are currently moving their capital towards AI-related stocks, IPOs and trades that anticipate expected interest rate cuts. This draws attention away from the crypto market, explaining Bitcoin’s relative weakness.

The chart from Glassnode and Schwab clearly shows how Bitcoin has always bounced back after major shocks over the years, from the collapse of Mt. Gox and the Chinese Bitcoin ban to the bursting of the ICO bubble and the rapid rise in inflation during the third halving cycle. The announcement of 100% China tariffs by Donald Trump also caused a temporary dip, but the upward trend remained intact.

Post-halving setup remains intact

Despite the temporary shift of capital towards AI, both parties see the broader Bitcoin trend as unbroken. Institutional adoption is increasing, US regulation is improving step by step and network usage is growing steadily. Bitcoin ETFs also saw positive inflows again recently after a period of outflows, demonstrating that institutional interest has not disappeared.

We are currently in the fourth halving cycle, and historically each halving is followed by a period of recovery and growth. Schwab and Hashdex state that the current weakness relative to stocks does not change that. AI is in the spotlight now, but in their view, the foundations for a further Bitcoin rise are still present. Michaël van de Poppe previously stated that crypto is on the verge of outperforming stocks, an expectation that aligns with the picture Schwab and Hashdex are now painting.