Bitcoin and cryptocurrency prices plummeted until September, proving that bears are right.
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Bitcoin prices are more than 15% lower than at the beginning of the month, and Ethereum and other major cryptocurrencies have fallen further. This week, China further plunged Bitcoin after declaring all crypto-related financial activity illegal, clearing the combined crypto market worth $ 150 billion.
Analyst on Wall Street Giants JP Morgan ahead of China’s latest Bitcoin and crypto crackdown
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“This is a Bitcoin recession and reflects weak demand from institutional investors who tend to gain exposure to Bitcoin using regulated Chicago Mercantile Exchange (CME) futures contracts.” The analyst wrote in the first note to the client Business insiderRefers to Bitcoin futures on CME trading below the Bitcoin price until September.
Investors say that the ongoing non-fungible token (NFT) epidemic has given rise to a second cryptocurrency by value, making Ethereum-based decentralized finance (DeFi) comparable to traditional finance. We found that large investors were avoiding Bitcoin futures and pivoting to Ethereum instead because of their expectations. According to CME data quoted by JP Morgan, the average Ethereum futures premium for 21 days is 1% above the actual Ethereum price.
“This shows that institutional demand for Ethereum and Bitcoin is much healthier,” analysts write.
Earlier this month, JP Morgan’s managing director Nikolaos Panigilzoglow said individual investors were pushing small cryptocurrencies to unprecedented highs, and Bitcoin’s market share is historically standard. “It looks unpleasantly low,” he said. “The crypto market seems to be bubbling again.”
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JPMorgan is the latest in a growing line of crypto market watchers praising Ethereum, and has reached the point where it predicts that Ethereum will eventually eat Bitcoin.
“”[Ethereum] Developer activity has exploded thanks to NFTs and DeFi, “said ArkInvest CEO Cathie Wood last week, revealing that confidence in Ethereum has” dramatically increased. ” ..
“I’m fascinated by what’s happening with DeFi. It’s breaking down the cost of financial services infrastructure in a way that the traditional financial industry knows it’s not currently evaluating.” Wood said.
However, there are concerns that the latest cryptocurrency crackdown in China may delay the adoption of cryptocurrencies.
“The announcement of China’s crypto trading ban caused a big sellout of Bitcoin and other altcoins. [and] Simon Peters, a crypto assets analyst at securities firm eToro, commented in an email.