Bitcoin fell more than 25% from roughly $83,000 to around $60,000 in May and early June, even as US stocks climbed to record highs.

According to data highlighted by on-chain analytics firm Glassnode on August 17, the divergence underscores how capital has flowed into equities and AI-related assets while demand for Bitcoin has weakened.

Glassnode said Bitcoin has been “significantly neglected” in the rotation, pointing to weaker demand for the cryptocurrency at a time when other risk assets were rallying.

Consumer Sentiment Hit a Record Low as Stocks Rallied

The divergence emerged against a backdrop of weakening consumer sentiment and strong equity-market performance.

According to Glassnode data, Consumer Confidence fell below 3,000 on its measure of the US stock market in May. Separately, the University of Michigan’s Consumer Sentiment Index fell to an all-time low of 44.8 in May.

“Consumer Confidence recently hit an all-time low as the stock market continued to make new highs. This weak sentiment is pushing money out of cash and into equities, AI, and commodities. bitcoin:native has been significantly neglected by this rotation pic.twitter.com/av4RA3Ibtw — glassnode (@glassnode) August 17, 2026”

The decline came as concerns about inflation and the economic effects of escalating conflict in the Middle East weighed on consumers.

At the same time, US equities moved in the opposite direction. The S&P 500 closed at 7,230.12 on May 1 after six consecutive weekly gains, then closed at a fresh record of 7,580.06 on May 29, up roughly 11% year-to-date. The Nasdaq gained about 16% year-to-date and the Dow around 6% year-to-date over the same period.

Bitcoin ETFs Saw Heavy Outflows

Meanwhile, Bitcoin followed a markedly different path.

Its price declined more than 25% during May and into the first days of June, falling from around $83,000 to approximately $60,000.

US spot Bitcoin ETFs recorded 13 consecutive days of net outflows during the month, the longest streak since the products launched in January 2024. Total outflows reached approximately $4.4 billion, with BlackRock’s IBIT alone accounting for around $3.3 billion.

Why Bitcoin and Stocks Diverged

Bitcoin’s decline accelerated in early June as escalating US-Iran tensions drove oil prices higher, lifted inflation expectations to 3.9%, up from 3.5% in April, and pushed US Treasury yields up more than 5%, adding further pressure on risk assets.

At the same time, the equity rally was concentrated in large AI and semiconductor companies. Strong corporate earnings and continued spending on artificial intelligence infrastructure helped support investor demand for parts of the technology sector.

The result was an unusual divergence: stocks continued to attract capital while Bitcoin experienced falling prices and significant ETF withdrawals.

That contrast also matters because Bitcoin’s market performance has increasingly been linked to the flow of institutional capital through ETFs, not just spot trading. When those flows weaken, there is less evidence of broad-based demand offsetting selling pressure elsewhere in the market.

Why This Matters

The divergence raises questions about Bitcoin’s role as a macro hedge and about the sources of demand supporting the cryptocurrency market.

Persistent ETF outflows and thin structural demand could keep Bitcoin exposed to risk-off pressure even if broader markets keep climbing.