Retail traders have started moving money from crypto into stocks, flipping the old pattern where both were bought together. The change began in late 2024 when data from JPMorgan and Wintermute showed that buying stocks now often means staying away from crypto.  

One reason is the way prices move. Crypto used to offer huge swings that attracted traders who liked quick profits. As institutions bring more ETFs into the market, those swings have shrunk. In early 2025 the price volatility of Bitcoin compared to Nasdaq fell below twice that of stocks, making equities a more attractive choice for those who still want movement but without the risk of huge losses.  

Another factor is technology. Large Language Models help investors read company reports and spot good stock picks, giving a feeling of an edge in the traditional market. Crypto lacks clear rules for value, so AI tools are less useful for choosing tokens.  

Apps that let people trade both crypto and stocks also make the switch easier. Earlier, moving money out of crypto required extra steps that kept it stuck in that space. Now a trader can sell Bitcoin and buy the S&P 500 ETF within the same platform, saving time and effort.  

The effect is that crypto is no longer a separate playground; it competes directly with equities for the same retail money. When the stock market slows, altcoins and meme coins can still attract interest, but only for a short time. To predict the next big crypto move, investors should keep an eye on how much trading happens in stocks. If people keep buying equities, the crypto market will stay hungry for new capital and may not reach previous highs again.

Stocks Take the Lead: Why Crypto Is Losing Ground

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