Software stocks are under growing pressure from AI, and analysts note that Bitcoin is, at its core, “open-source software.”
Bitcoin has increasingly tracked software stocks, with its latest correction unfolding alongside a broader tech selloff.
The cryptocurrency’s correlation with software equities has strengthened. On a 30-day rolling basis, Bitcoin’s correlation with the iShares Expanded Tech-Software ETF (IGV) stands at 0.73, according to ByteTree. Year to date, IGV is down about 20%, while Bitcoin has fallen 16%.
IGV is heavily weighted toward software and services leaders such as Microsoft (MSFT), Oracle (ORCL), Salesforce (CRM), Intuit (INTU), and Adobe (ADBE).
While the broader tech sector remains relatively resilient—the Nasdaq 100 (QQQ) is only around 4% below its record high—software stocks have borne most of the selling pressure. Bitcoin is increasingly moving in line with this weaker segment rather than the broader market.
The driver is clear: AI. Rapid progress toward artificial general intelligence (AGI) is being viewed as an existential threat to many software companies.
“There’s no doubt Bitcoin has been caught up in the technology selloff,” said ByteTree. “At its heart, Bitcoin is an internet stock. Software stocks have been the latest casualty, and over the past five years, Bitcoin has closely mirrored their performance.”
ByteTree notes that the average technology bear market lasts about 14 months. With this downturn beginning in October, pressure could continue through much of 2026, although a resilient economic backdrop may provide support for Bitcoin.
