Bitcoin is being sold by large investors. JPMorgan warns about Ethereum amid a $150 billion crypto price drop. Bitcoin and cryptocurrency values have plummeted since the beginning of September, confirming that bears are correct.
The price of bitcoin has dropped by more than 15 percent since the beginning of the month. With the price of ethereum and other major cryptocurrencies plunging even further. Following China’s declaration of all cryptocurrency-related financial operations unlawful this week. Bitcoin’s value plummeted even more, wiping off an estimated $150 billion. From the combined cryptocurrency market.
JPMorgan JPM +1.5 percent analysts have cautioned that big investors are beginning to shift away. From bitcoin futures and towards ethereum as a result of a “significant divergence in demand.” Ahead of China’s current bitcoin and cryptocurrency crackdown.
While noting that bitcoin futures on the CME have been trading below the bitcoin price since September. The analysts stated that this is “a setback for bitcoin” and “a reflection of weak demand. By institutional investors who typically use CME-regulated futures contracts to gain exposure to bitcoin. ” The note was obtained by Business Insider and was first published by Business Insider.
Big investors are eschewing bitcoin futures
Researchers discovered that big investors are steering clear of bitcoin futures and instead investing in ethereum. The second most valuable cryptocurrency by market capitalization. Ethereum is gaining momentum as a result of the ongoing non-fungible token (NFT) craze and expectations. That ethereum-based decentralized finance (DeFi) will compete with traditional finance, according to the researchers. In the last 21 days, the average premium above actual ether prices has risen. To 1 percent, according to data from the CME, which was reported by JPMorgan.
“This indicates that institutional investors are far more interested. In ethereum, than they are more like in bitcoin, ” the experts wrote.
Nikolaos Panigirtzoglou, managing director of JPMorgan, stated earlier this month that retail investors. Have been propelling smaller cryptocurrencies to previously unseen highs. With bitcoin’s share of the market looking “uncomfortably low”. By historical standards and “making cryptocurrency markets look frothy again.”
The latest in a growing line of crypto market
According to JPMorgan, ethereum is becoming increasingly popular among crypto market observers. With some even predicting that it could someday surpass bitcoin in importance.
Because of NFTs and DeFi, “[Ethereum] is seeing an explosion in developer activity,” Cathie Wood. She is also the chief executive of Ark Invest, stated last week. And indicating that her faith in the cryptocurrency has “gone up considerably.”
The cost of infrastructure for financial services is collapsing at a rate that Wood finds fascinating. “I’m fascinated by what’s going on in DeFi, which is collapsing the cost of infrastructure for financial services at a rate. That I know the traditional financial industry does not appreciate right now,” Wood said.
However, it is anticipated that the most recent crypto crackdown in China would cause crypto adoption to stall.
eToro crypto-asset analyst Simon Peters said in an email that the announcement of China’s prohibition. It is on cryptocurrency transactions “has prompted a significant sell-off in bitcoin. And other altcoins [and] could prove to be a stumbling block to the worldwide adoption of crypto.”