Deutsche Bank: BTC drop stems from weak confidence, not market collapse

Bitcoin's price decline is due to weakening confidence among institutional investors and regulatory uncertainty, rather than structural market flaws, according to Deutsche Bank. The bank noted that BTC is currently facing headwinds from continuous institutional outflows, a breakdown in its correlation with traditional financial markets, and a loss of momentum in achieving regulatory clarity. Deutsche Bank explained that BTC's status as 'digital gold' has eroded, with the asset falling this year while gold has risen more than 60%, and its correlation with the stock market has also weakened. Furthermore, delays in processing a U.S. bill on crypto market structure (CLARITY) appear to have increased market volatility and dampened investor sentiment. The bank concluded that the current downturn is a process of giving back the gains of the past two years, rather than a market collapse, and represents a step toward BTC becoming a more mature asset.