Software stocks are pulling away from bitcoin after years of closely tracking the cryptocurrency, although previous market cycles indicate BTC could eventually narrow the performance gap.
The iShares Expanded Tech-Software Sector ETF (IGV) has climbed to its highest level against bitcoin in roughly a year, with the IGV-to-BTC ratio reaching 0.0016.
The two assets had largely moved in tandem for years before their relationship began weakening in May. IGV has declined only about 1% so far in 2026, while bitcoin is down roughly 29%. Their 20-day rolling correlation has also turned negative, marking the first such reading since May 2024.
The software ETF has staged a powerful recovery, gaining around 40% from its April bottom. At the time, investors were concerned that artificial intelligence could trigger a “SaaS apocalypse” by disrupting traditional software businesses.
IGV is now roughly 13% below its record high. Bitcoin, by comparison, remains about 50% beneath its own all-time peak.
The divergence is notable because bitcoin was previously pulled lower alongside software stocks. IGV fell approximately 40% from its fourth-quarter 2025 peak, reinforcing the tendency among investors to trade bitcoin as a technology-style risk asset.
There is some historical support for the view that the gap may not last. Negative correlations between bitcoin and software stocks have appeared during several major market disruptions, including Bitcoin’s 2018 bear market, the COVID-19 shock in 2020 and China’s 2021 crackdown on bitcoin mining.
In each instance, bitcoin eventually recovered relative to software stocks and the correlation between the two assets moved back into positive territory.
Whether that pattern repeats this time remains uncertain. The latest divergence could eventually close as Bitcoin catches up, or it could signal a longer-lasting separation between cryptocurrency and technology equities.
