City Group, a Wall Street banking giant, stated in a research report that the relationship between stock markets and digital currencies is likely to weaken in the future. Despite stocks remaining a crucial factor in digital currency markets, the correlation between stocks and digital currencies is expected to decrease due to the maturity of this emerging asset class, investor base growth, technological advancements, and increased adoption. However, the speculative nature of digital currency markets may increase the correlation of high-risk assets, especially during risk-averse events. City analysts believe that a more transparent regulatory regime in the U.S. will lead to more independent price movements and anticipate that Bitcoin fluctuations will decrease in the long term with institutional adoption.
