Bitcoin’s (BTC) price action has closely mirrored that of the US equity market in recent years, particularly the tech-heavy Nasdaq and the benchmark S&P 500.

Now, as fund managers stage a historic exodus from US stocks, the question arises: could Bitcoin be the next casualty?

Fund managers dump US stocks at record monthly pace

Investors slashed their exposure to US equities by the most on record by 40-percentage-points between February and March, according to Bank of America’s latest survey.

This is the sharpest monthly decline since the bank began tracking the data in 1994. The shift, dubbed a “bull crash,” reflects dwindling faith in US economic outperformance and rising fears of a global downturn.

With a net 69% of surveyed managers declaring the peak of “US exceptionalism,” the data signals a seismic pivot that could ripple into risk assets like Bitcoin, especially given their persistent 52-week positive correlation over the years.

Bitcoin and S&P 500 index 52-week correlation coefficient chart. Source: TradingView

More downside risks for Bitcoin and, in turn, the broader crypto market arise from investors’ rising cash allocations.

BofA’s March survey finds that cash levels, a classic flight-to-safety signal, jumped to 4.1% from February’s 3.5%, the lowest since 2010.

BofA Global Fund Manager March survey results. Source: BofA Research

Adding to the unease, 55% of managers flagged “Trade war triggers global recession” as the top tail risk, up from 39% in February, while 19% worried about inflation forcing Fed rate hikes—both scenarios that could chill enthusiasm for risky assets like Bitcoin.

Conversely, the survey’s most crowded trades list still includes “Long crypto” at 9%, coinciding with the establishment of the Strategic Bitcoin Reserve in the US.

Meanwhile, 68% of managers expect Fed rate cuts in 2025, up from 51% last month.

Related: ‘We are worried about a recession,’ but there’s a silver lining — Cathie Wood

Lower rates have previously coincided with Bitcoin and the broader crypto market gains, something bettors on Polymarket believe is 100% certain to happen before May.

Bitcoin price hangs by a thread

Bitcoin’s price has declined by over 25% two months after establishing a record high of under $110,000 — a dropdown many consider a bull market correction, suggesting that the cryptocurrency may recover in the coming months.

“Historically, Bitcoin experiences these types of corrections during long-term rallies, and there’s no reason to believe this time is different,” Derive founder Nick Forster told Cointelegraph, adding however that the cryptocurrency’s next six months depend on how traditional markets (stocks) perform.

Technically, as of March 19, Bitcoin was holding above its 50-week exponential moving average (50-week EMA; the red wave) at $77,250.

BTC/USD weekly price chart. Source: TradingView

Historically, BTC price returns to the 50-week EMA after undergoing strong rallies. The cryptocurrency’s decisive break below the wave support has signaled a bear market in the past, namely the 2018 and 2022 correction cycles.

Source: Milkybull Crypto

A clear breakdown below the wave support could have BTC’s bears eye the 200-week EMA (the blue wave) below $50,000, echoing the downside sentiment discussed in the BofA survey.

Conversely, holding above the 50-week EMA has led prices to new sessional highs, akin to what the market witnessed in 2024. If Bitcoin recovers from the said wave support, its likelihood of testing the $100,000 psychological resistance level is high.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

Victims of address poisoning scams were tricked into willingly sending over $1.2 million worth of funds to scammers, showcasing the problematic rise of cryptocurrency phishing attacks.

Address poisoning, or wallet poisoning scams, involves tricking victims into sending their digital assets to fraudulent addresses belonging to scammers.  

Pig butchering schemes on Ethereum have cost the crypto industry over $1.2 million worth of funds in the nearly three weeks since the beginning of the month, wrote onchain security firm Cyvers in a March 19 X post:

“Attackers send small transactions to victims, mimicking their frequently used wallet addresses. When users copy-paste an address from their transaction history, they might accidentally send funds to the scammer instead.”

Source: Cyvers Alerts

Address poisoning scams have been growing, since the beginning of the year, costing the industry over $1.8 million in February, according to Deddy Lavid, co-founder and CEO of Cyvers.

The growing sophistication of attackers and the lack of pre-transaction security measures are some of the main reasons for the increase, the CEO told Cointelegraph, adding:

“More users and institutions are leveraging automated tools for crypto transactions, some of which may not have built-in verification mechanisms to detect poisoned addresses.”

While the higher transaction volume due to the crypto bull market is a contributing factor, pre-transaction verification methods may stop a significant amount of phishing attacks, said Lavid, adding:

“Unlike traditional fraud detection, many wallets and platforms lack real-time pre-transaction screening that could flag suspicious addresses before funds are sent.”

Related: August sees 215% rise in crypto phishing, $55M lost in single attack

Address poisoning scams have previously cost investors tens of millions. In May 2024, an investor sent $71 million worth of Wrapped Bitcoin to a bait wallet address, falling victim to a wallet poisoning scam. The scammer created a wallet address with similar alphanumeric characters and made a small transaction to the victim’s account.

However, the attacker returned the $71 million days later, after he had an unexpected change of heart due to the growing attention from blockchain investigators.

Related: Ledger users targeted by malicious ‘clear signing’ phishing email

Phishing scams are a growing problem for the crypto industry

Phishing scams are becoming a growing threat to the crypto industry, next to traditional hacks.

Pig butchering scams are another type of phishing scheme involving prolonged and complex manipulation tactics to trick investors into willingly sending their assets to fraudulent crypto addresses.

Pig butchering schemes on the Ethereum network cost the industry over $5.5 billion across 200,000 identified cases in 2024, according to Cyvers.

The average grooming period for victims lasts between one and two weeks in 35% of cases, while 10% of scams involve grooming periods of up to three months, according to Cyvers data.

Pig butchering victim statistics and grooming periods. Source: Cyvers

In an alarming sign, 75% of victims lost over half of their net worth to pig butchering scams. Males aged 30 to 49 are most affected by these attacks.

Phishing scams were the top crypto security threat of 2024, which netted attackers over $1 billion across 296 incidents as the most costly attack vector for the crypto industry.

Magazine: Down to $200 one day, Pixels founder had $2.4M the next: Luke Barwikowski, X Hall of Flame

The United States Securities and Exchange Commission’s multi-year enforcement action against Ripple is finally coming to an end, according to the company CEO.

“This is it — the moment we’ve been waiting for. The SEC will drop its appeal — a resounding victory for Ripple, for crypto, every way you look at it,” Ripple CEO Brad Garlinghouse wrote on X on March 19.

Source: Brad Garlinghouse

“I’m finally able to announce that the case has ended; it’s over,” Garlinghouse said in the attached video to the X post.

The end of a long-running legal battle between Ripple and the SEC comes four years after the US securities regulator sued the company over an alleged $1.3 billion unregistered securities offering in December 2020.

“We’re now closing a chapter in crypto history,” Garlinghouse stated, adding that “it’s time to make the United States the crypto capital of the world.”

Data from Cointelegraph Markets Pro and TradingView show that the crypto market responded positively to the development.

XRP price shot up 10% following SEC’s backout. Source: TradingView

This is a developing story, and further information will be added as it becomes available.