Deutsche Bank (DB) said bitcoin’s sliding to around $80,000 on November 21st, about 35% below the peak in early October, shows how quickly macroeconomic pressures and fragile market structures can erase crypto gains, wiping out nearly $1 trillion in value before the token bounced back towards $87,000.
The world’s largest cryptocurrency was priced around $86,000 at the time of publication.
The bank attributed the drop to a mix of risk-off sentiment, higher-for-longer interest rate expectations, fading regulatory momentum, weakening institutional flows and profit-taking by long-term holders, arguing that these forces have tested bitcoin’s portfolio role and revived its “Tinkerbell effect”, where sentiment-driven belief supports.
As stocks fell on U.S. fiscal concerns, renewed U.S.-China tensions and stretched AI ratings, bitcoin moved more like a high-beta tech stock than a hedge, with correlations to major indexes jumping to stress-era levels, analysts Marion Laboure and Camilla Siazon wrote in Monday’s report.
The analysts also highlighted hawkish Federal Reserve announcements, despite a rate cut, as a trigger that amplified bitcoin’s negative sensitivity to changing interest rate expectations.
Regulatory progress has stalled, the bank noted, with CLARITY Act delays eroding optimism about clearer market structure and deeper liquidity.
Meanwhile, institutional flows have turned sharply, with thinner order books amplifying sell-offs and spot outflows from exchange-traded funds (ETFs) fueling a negative liquidity cycle. Long-term owners have sold heavily as volatility increased, adding to the pressure.
The report argued that bitcoin’s long-term maturation remains intact, but warned that uncertainty, leverage and political ambiguity continue to magnify withdrawals, although eventual regulatory clarity and broader institutional adoption could support future phases of the market.
Read more: Citigroup warns of chill in Bitcoin halving season as prices slide, ETF outflows near $4bn
