Recently, the adjustment in the crypto market has been so sudden that "abrupt" hardly suffices to describe it. Bitcoin has fallen from a high of about $125,000 in early October, dropping over 35%, and even briefly touching $86,000. Many were expecting the Federal Reserve's easing policies to take effect, but instead, a hawkish "turnaround" occurred. The total market cap of cryptocurrencies shrank by approximately $1 trillion within a few months, a figure that represents many investors' accounts turning red.

But is this sharp decline really just a policy shock? Not entirely. Deutsche Bank's latest analysis points to a deeper logic — this adjustment is the result of a collision between macro and micro factors. A comprehensive correction of risk assets, a hawkish shift in the Federal Reserve's policy stance, regulatory stagnation, quiet withdrawals by large institutions, and long-term holders cashing out profits—all these forces have pushed the market down from its peak.

What’s more painful is that the myth of Bitcoin's "hedging" attribute has been shattered. When trade tensions are high and tech stocks face valuation doubts, Bitcoin does not move independently; instead, it plunges along with high-growth tech stocks. The data shows that since the start of 2025, the daily correlation between Bitcoin and the Nasdaq 100 has soared to 46%, and its correlation with the S&P 500 has risen to 42%. What does this mean? Bitcoin's current price movement logic is now more similar to a high-growth tech stock than to the so-called store of value that supposedly transcends market cycles.