JPMorgan Chase & Co. has warned that any upside for crypto markets from here would likely be more limited. Basing their prediction on the relationship between stablecoins and the rest of the crypto market, the bank’s analyst explained that stablecoins’ share of the total crypto market cap “no longer looks excessive.”
JPMorgan’s Crypto Outlook
According to a report by JPMorgan, the global investment bank cautioned about cryptocurrency markets’ limited upside in a publication last week.
JPMorgan sees stablecoins’ share of the total cryptocurrency market value as an indicator of potential for rallies or declines. Previously, when stablecoins accounted for almost 10% of the total crypto market cap, JPMorgan analyst Panigirtzoglou said it “pointed to further upside for crypto markets.”
In the note issued last week, he explained: “The share of stablecoins in total crypto market cap no longer looks excessive … This share currently stands below 7% which brings it back to its trend since 2020.” The JPMorgan analyst continued:
We believe there is less upside to crypto markets.
Panigirtzoglou stated that the prices of Bitcoin (BTC), and ether(ETH) rose in March due to financial sanctions imposed upon Russia by Western nations following its invasion.
The note describes: “These sanctions had raised expectations that cryptocurrencies will be used more extensively in the future to circumvent the traditional banking system given cryptocurrencies are not attached or depend on any government.”
The JPMorgan analyst cited the stablecoin-share indicator to warn that crypto market rallies may soon be over.
JPMorgan forecasted that bitcoin’s long-term value would rise to $150,000 in February. The bank carried out a survey of clients in January and discovered that most respondents anticipated the bitcoin price to rise to $60,000 this year.
Many have stated that they see significant upside in the cryptocurrency market, contrary to JPMorgan. The CEO of Defiance ETFs said she remains “completely bullish on bitcoin,” expecting the price of the cryptocurrency to reach $100,000. Mike Novogratz from Galaxy Digital also highlighted a variety of positive factors that will affect the crypto market last week.
What do you think about JPMorgan’s assessment of the crypto market? Comment below to let us know your thoughts.
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