Deutsche Bank Say Bitcoin is now too important for regulators to ignore

By: Mark Jessy

Deutsche Bank Say Bitcoin is now too important for regulators to ignore

March 21, 2021 5:34 PM

The banking giants anticipate governments to ramp up regulation of bitcoin before the end of 2021 according to the analyst.

 

Largest crypto assets 'BTC' markets capitalization recently crossed $1 trillion for the first time, the rally which started in late 2020 doesn't seem to be slowing down soon and its continued growth has made the crypto assets too important to ignore, according to an analyst from Deutsche Bank.

 

In exclusive financial research devoted to bitcoin and conducted by the Deutsche Bank Research, a subsidiary of the Deutsche Bank, the 18-page research was titled "The Future of Payments: Series 2 Part III."

 

The study furthers describes the basic element of bitcoin pinpointing key areas and drivers of the flagship crypto price movement to becoming a $1 trillion asset.

 

Large firms have jumped on the Bitcoin ship as institutional interest continues to rise, as companies such as Tesla added bitcoin to their balance sheet. Analysts and critics were quick to think the government won't allow the dollar to be replaced by the crypto asset sighting future regulations if things continue in the same way.

 

However, the Deutsche Bank analyst explained that BTC value could continue to rise as long as there is rising adoption of the crypto assets in the form of assets managers and firms entering the bitcoin market. The analyst added that with bitcoin's current status, the central banks and government now understand that bitcoin along with other cryptocurrencies are here to stay and anticipates that they start regulating them by late 2021.

 

Although, the Deutsche Bank Research warns that despite bitcoin's rising valuation, the growth as an asset class could be hindered by its limited liquidity and tradability.

The analyst added: 
"The real debate is? Could Bitcoin rising valuations alone be a sufficient reason for BTC to evolve into an asset class, or if its illiquidity could be a major setback in the process."

 

In conclusion according to the analyst, bitcoin is expected to stay ultra volatile in the short term, while they foresee a turning point for the crypto asset in the next 2-3 years as an agreement about Bitcoin future may arise.