Bitcoin RIPPED 22% While Stocks Went Nowhere - Is Something Breaking?

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Bitcoin ripped 22% while stocks went nowhere, leaving many analysts wondering if the correlation, which I put in air quotes and I'll tell you why later, is finally breaking down. Meanwhile, Bitcoin is the most correlated to gold that it's ever been in six years. Is something finally breaking here? We're going to discuss that, but dive much more deeply into Arbitrum and Robinhood Chain today with Stephen Goldfeder from Off Chain. And of course, at the end of the show, I've got the weekly reckoning. Fridays are shaping up nicely here. Let's go.
Good morning, everybody. Happy Friday. I hope that you're all having a wonderful day. As you can see, the new corporate skyscraper of thewolfofallstreets.gov.org has been built here on my left shoulder, here on the New York City skyline. All right, so before we bring on the guests, just going to cover one or two small things. Of course, this is the one from the title here. Bitcoin gold correlation hit six-year high, but analysts question whether equity decoupling will last. They should question that because Bitcoin is a beautifully uncorrelated asset. The very fact that we have to have a conversation about it, decoupling from stocks and recoupling from gold, and then decoupling from gold, and then recoupling from stocks means that it's just a random walk in the park, and sometimes Bitcoin can be in concert with one or the other, but if it's not correlated over the long term to one or the other, then it is not correlated at all. I've always said that Bitcoin is a largely uncorrelated asset, which makes it the holy grail of a portfolio. When you are an investor, forget all of the libertarian properties of Bitcoin for this very conversation, but when you are an investor and you have a portfolio, you want something with idiosyncratic risk. Even if it's 5% of your portfolio, you want something that's not going to necessarily do what everything else in your portfolio does. Unfortunately, sometimes that means that your thing will go down when everything goes up, which is what was happening with Bitcoin. But the fact that people are arguing that it was correlated to stocks when the stock market has been making all-time highs while Bitcoin went down 55% is in and of itself insane. And now we're talking about Bitcoin's gold correlation hitting a six-year high when it's only been for about two weeks. Maybe that should say Bitcoin gold correlation hits very low time frame, six-year high, right? Not particularly accurate. So if you're wondering why Bitcoin kind of made the move yesterday over the past few days, US Bitcoin ETFs report the largest inflow since January worth $731 million from a technical perspective. If you do care, Bitcoin here is really at the most key level kind of on the chart right now. That 50 MA there on the weekly, a lot of technical analysts are watching. But of course, if it gets above this 82,000, 8 or 900 area, that would be a higher high.
And all the bears are dead if that happens. All right. So that is my brief thoughts on what's happening with Bitcoin right now. Now I'm going to bring on today's amazing guest. We've got Steve Goldfeder here from Off Chain. How are you, man?

**SPEAKER_1** (3:31)
Hey, I'm good. It's great to be here. Hey, I'm good. It's great to be here.

**Scott Melker** (3:35)
So like I said, last time I introduced you was of Off Chain Labs, the builders of Arbitrum. But now you've dropped the labs, which I like.

**SPEAKER_1** (3:44)
Yes, we still have a labs component, but we've dropped it from our name, yes.

**Scott Melker** (3:50)
So you obviously are heavily focused on Arbitrum. And I think one of the biggest news stories of the past few months, obviously, was that Robinhood Chain launched as an L2 on Ethereum, but using Arbitrum. Can you explain to us exactly what that means and how that came together?

**SPEAKER_1** (4:07)
Absolutely. So for actually a few years now, we've had what we call the Arbitrum Expansion Program in production, which means you can take the Arbitrum technology and not only build on Arbitrum One, which is the core Arbitrum Chain, or many people just call Arbitrum, but you can actually use that technology stack to build your own chain as well. And many different enterprises have used that over the years. I think it's getting a lot more attention now because Robinhood is doing it at a scale that's never been seen before, and the revenue share is also in magnitude reaching a scale that's never been seen before. But the idea is that Arbitrum has a dual strategy. On the one hand, you have Arbitrum One, which is one of the most liquid environments for DeFi and a very, very strong environmental launch product. But for those that want to move past that and graduate to their own environment, that works as well. And so we support both of these, and that is Robinhood actually did both. So they started off about a year ago in June of 25, they announced that they are launching stock tokens initially on Arbitrum One. They launched about 2,000 tokenized equities on Arbitrum One. And in June of this year, the last day of June, they announced their chain, which went live July 1st this year. And that actually now has their own Arbitrum environment, and they can move seamlessly from one to the other.