Core Viewpoint - Deutsche Bank identifies five major pressures facing Bitcoin, including increased correlation with the Nasdaq, hawkish Fed comments dampening rate cut expectations, stalled regulatory legislation, large-scale withdrawals of institutional funds via ETFs, and record sell-offs by long-term holders [1][5][25]. Group 1: Market Performance and Correlation - Bitcoin has dropped nearly 35% from its peak of approximately $125,000 in early October to around $80,000 [3]. - The entire cryptocurrency market has seen a staggering $1 trillion evaporate in market capitalization, reflecting a 24% decline [3]. - Bitcoin's volatility surged from a low of 20% in August to 39%, with its correlation to the Nasdaq and S&P 500 rising to 46% and 42%, respectively [5][7]. Group 2: Macroeconomic Factors - The narrative of Bitcoin as a safe-haven asset has been disproven during this downturn, as its sell-off coincided with declines in the U.S. stock market and other risk assets [6][10]. - The Fed's hawkish stance has created a strong negative correlation between Bitcoin prices and interest rates, with historical data showing a correlation of -90% during the 2022 rate hike cycle [11][13]. - Following hawkish comments from Fed officials, Bitcoin experienced significant price drops, including a 6% decline on November 4 [12]. Group 3: Regulatory Environment - The lack of regulatory clarity is undermining market confidence, with the CLARITY Act stalled in the Senate due to political disagreements [14][15]. - The absence of regulatory momentum is hindering institutional investor participation and market liquidity [15]. Group 4: Institutional Dynamics - Institutional funds that previously fueled Bitcoin's bull market are now exiting, creating a negative feedback loop that exacerbates price declines [16][20]. - Recent data indicates significant daily net outflows from U.S. spot Bitcoin ETFs, contrasting sharply with earlier inflows [19]. Group 5: Long-term Holder Behavior - Long-term holders have sold over 800,000 Bitcoins in the past month, marking the highest level of sell-offs since January 2024 [21][22]. - The Crypto Fear and Greed Index dropped to 11, indicating extreme fear in the market, further reinforcing bearish sentiment [23][24]. Group 6: Future Outlook - The potential for Bitcoin's recovery is uncertain and hinges on several key factors, including regulatory clarity, adoption of stablecoins by mainstream institutions, and growing interest from governments and central banks in crypto assets [27][28][29].