The Nasdaq’s decline and more than $1 billion in crypto liquidations have once again raised questions about cryptocurrencies‘ independence from technology stocks. Bitcoin also came under selling pressure, falling toward $75,000 and weakening the recovery that followed the U.S. midterm elections.

Concerns about a potential slowdown in artificial intelligence investment coincided with another wave of risk reduction. However, attributing the entire decline to political expectations would oversimplify a market also influenced by leverage, liquidity, and decisions made by major investors.

Bitcoin emerged as an alternative to the traditional financial system, but its behavior during broad market selloffs increasingly resembles that of other speculative assets.

The question is whether this relationship means cryptocurrencies have lost their economic independence or whether liquidations simply amplify temporary market movements.

The Crypto Market Is Exposed to Tech Stock Selloffs

Artificial intelligence companies have attracted enormous investment, but their valuations also depend on growth expectations that are difficult to sustain indefinitely.

When investors begin questioning those expectations, they may simultaneously reduce their positions in technology stocks and cryptocurrencies.

Institutional investment in Bitcoin makes it easier for both markets to respond to the same investment decisions. A fund manager looking to reduce risk may sell different assets without necessarily distinguishing between their technological characteristics.

This does not mean Bitcoin, cryptocurrencies, and AI stocks share the same economic fundamentals.

Technology companies generate revenue and must justify their valuations through financial performance. Bitcoin, by contrast, has a limited supply, and its price depends on demand from those seeking to hold or trade it.

But that distinction becomes less important during rapid selloffs, when traders seek liquidity.

Bitcoin’s programmed scarcity does not prevent its price from falling when investors become less willing to take risks.

That is why treating every recovery as proof of the crypto market’s independence is just as problematic as considering a simultaneous decline definitive evidence of dependence.

Liquidations Amplify Losses Without Measuring Total Demand

More than $1 billion in liquidations illustrates how much the derivatives market can intensify price movements.

When a leveraged position no longer meets its collateral requirements, trading platforms may close it automatically. Those sales create additional pressure in a market that is already declining.

A forced liquidation does not necessarily mean a long-term investor has decided to abandon Bitcoin. This distinction is essential because the volume of closed positions can exaggerate the apparent deterioration in demand.

Assessing the situation also requires examining spot trading, exchange-traded fund (ETF) flows, and the market’s ability to absorb selling pressure without experiencing further sharp declines.

However, not every rebound should be interpreted as a solid recovery. Prices can rise after a wave of liquidations simply because some of the selling pressure disappears.

Bitcoin’s resilience needs to be demonstrated through sustained buying, not merely by how quickly it recovers certain price levels.

Bitcoin Still Needs to Prove It Can Serve as a Store of Value

Institutional adoption has made Bitcoin and other cryptocurrencies more accessible, but it has also connected Bitcoin to investment portfolios that respond to interest rates, economic expectations, and changes in risk appetite.

The easier it becomes to include Bitcoin in a traditional portfolio, the easier it is to sell it alongside other assets when losses increase.

This creates a contradiction for those who advocate using it as an independent store of value.

A limited supply can protect against the arbitrary issuance of new units, but it does not guarantee price stability or independence from financial markets.

At the same time, a high correlation over a single trading day does not determine how Bitcoin will behave over several years.

Upcoming U.S. employment data and crypto ETF flows will help assess whether investors continue reducing their exposure or take advantage of lower prices to buy.

The crypto market needs to demonstrate that it can sustain demand of its own even when technology stocks lose their appeal.

If Bitcoin continues to depend on the same financial conditions driving AI valuations, its scarcity will remain an important feature of the protocol, but insufficient to automatically make it a safe haven during market turmoil.