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JP Morgan Explains Why Bitcoin Price May Not Fall Further

The cryptocurrency market has been in a declining trend for years. However, reports reveal a possible recovery and bullish turn for popular cryptocurrencies in the space. JP Morgan has predicted a possible price rebound for Bitcoin, saying that long-term liquidations are “largely behind us.”

JP Morgan Sees Upside For Bitcoin Price

JP Morgan, an American multinational financial services firm published an interesting research report on Thursday, August 24. Analysts led by Nikolaos Panigirtzoglou, Managing Director at JP Morgan indicated that crypto markets are likely to emerge from the declining trend from liquidations and market turmoil and move into a correction phase completely. 

They believe that the crypto market has been able to overcome a significant amount of negative factors that push the market to a “limited downside.” Their predictions are also based on the indications of a decline in open interest in Bitcoin futures contracts on the Chicago Mercantile Exchange (CME), a global derivatives marketplace. 

The crypto market has been on a severe declining trend while Bitcoin’s progress has been muffled after experiencing devastating market blows, and regulatory hurdles. The stunning fall of Terra stablecoin was one of the major challenges the industry faced, wiping over $200 billion worth of cryptocurrency assets from the space.

FTX’s collapse has also pushed the evolution of cryptocurrencies back by a couple of years, shattering investor’s confidence in the crypto space and hinting at the lack of a better regulatory framework in the industry. 

The United States Securities and Exchange Commission (SEC) has also been in hot pursuit of new victims, throwing lawsuits against prominent exchanges and crypto firms like Binance, and Coinbase.

All things considered, Bitcoin’s fight against evolutionary pressures has yielded positive results. A crypto analyst provided compelling insights on Bitcoin’s network, revealing that the spikes in on-chain transfers seen in Bitcoin’s network activity are a great indicator for a probable macro uptrend for the cryptocurrency. 

 

Bitcoin Price On The Verge Of Recovery Following Positive Developments In Crypto Space

There have been a significant number of positive developments that have pushed the price of major cryptocurrencies, including Bitcoin upwards. Ripple’s victory against the SEC is among said developments. The XRP ruling by Judge Annalise Torres has brought new optimism in the space and has also provided essential regulatory clarity for cryptocurrencies. 

Additionally, the increase in applications for Bitcoin spot exchange-traded funds (ETFs) has also boosted its price considerably. World-leading financial services providers like Blackrock, Ark Investment, Hashdex, Grayscale, and others are already competing for a spot in Bitcoin ETF. 

There are also reports of a potential collaboration between Bitcoin and Elon Musk’s SpaceX to enable cross-border payments for space-linked activities. 

Overall, the crypto landscape is showing signs of stability as it navigates through major industry hurdles. Crypto investors are also eagerly anticipating the potential recovery of Bitcoin and other cryptocurrencies. 

Bitcoin price cap chart from Tradingview.com (JP Morgan)

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Here’s Why Arthur Hayes Is Not In Support Of A BlackRock Spot Bitcoin ETF

Many stakeholders in the crypto industry have welcomed the idea of traditional finance firms offering a Spot Bitcoin Exchange-Traded Fund (ETF) as they believe it will further drive crypto adoption. However, the former CEO and co-founder of crypto exchange BitMEX, Arthur Hayes, seems to be against the move.

Problems With BlackRock Spot Bitcoin ETF Filing

In a post published on his Substack platform, Hayes made his displeasure known regarding the recent wave of Spot Bitcoin ETF applications by prominent traditional financial (TradFi) institutions, including BlackRock.

Contrary to public opinion, he doesn’t believe these TradFi institutions are bullish on crypto. Instead, they are moving to become “crypto gatekeepers” to balance their deposit base, explaining that these companies intend to offer ETFs or any similar investment product with crypto as its underlying asset to achieve this. 

He stated that since these fund managers will be the “only game in town,” they can charge investors enormous fees in exchange for their investment products.

According to him, institutions like BlackRock recognize that cryptocurrencies can be used to hedge against inflation and could have a significant impact on the economy going forward. So they want to have it “under their control” when that happens.

He believes the only times these firms have done a “good job” is to paint the crypto industry and cryptocurrencies in a bad light to the government. As such, they will have a hard time changing the narrative to circumvent the federal government’s proposed inflation tax on bank depositors.

The Bitmex founder suggested that the United States Securities and Exchange Commission’s (SEC) clampdown on the crypto industry was never about the technology itself but who owned it. 

He believes those who had earlier tried to get a Bitcoin ETF approved faced disapproval based on their status. However, the regulator seems more welcoming to the idea because of the prestige of BlackRock and its CEO, Larry Fink. 

Bitcoin price chart from Tradingview.com (BlackRock Spot Bitcoin ETF)

TradFi Doesn’t Care About Decentralization

Hayes noted that the banks and financial regulators could collaborate to uphold the dollar’s sovereignty. According to him, this can be easily achieved by both parties agreeing to ensure that all crypto redemptions are made in the US dollar and not the “physical crypto” itself. 

These US dollars will then be put back into the banking system, which he believes is already compromised. 

Hayes is more concerned that all this goes against Satoshi’s vision of creating a decentralized financial system and he believes BlackRock’s CEO Larry Fink doesn’t care about decentralization. 

He highlighted that Fink and BlackRock’s business model is built on centralization, adding that asset managers like BlackRock do not add value to the Bitcoin Improvement Proposals, such as increased privacy or censorship resistance. 

Instead, these asset managers moving to offer ETFs means they have more control over large voting blocks and can affect governance decisions.