The recent rise in cryptocurrency prices is driven primarily by impulsive decisions by individual traders rather than by institutional investors or market fundamentals. This is reported by The Blockciting the opinion of JPMorgan analysts.
“As with equities, we see retail momentum in the crypto context emerging in February. This was probably the reason for the powerful rally this month,” said financial holding expert Nikolaos Panigirtzoglou.
Reflecting the dynamics of the top 30 digital assets, the GMCI 30 index since the beginning of the year grew by more than 13%.
According to analysts, another indicator of retail interest in cryptocurrencies is the popularity of meme tokens and coins directly or indirectly related to artificial intelligence. The share of such assets in the total market capitalization increased in February.
JPMorgan also noted a revival among users of the Block, PayPal, Robinhood and Coinbase platforms, which has continued since the fourth quarter of 2022. According to experts, the recent surge in retail trade can be attributed to three main catalysts:
- the upcoming Bitcoin halving;
- the expected large-scale update of Dencun on the Ethereum network in March;
- prospects for approval of an ETF based on the second largest cryptocurrency by capitalization.
In their opinion, the first two factors are already “largely factored into” asset prices. At the same time, the probability of launching new financial products based on Ethereum is only 50%.
Earlier, JPMorgan experts discovered that Bitcoin ETFs from BlackRock and Fidelity have become more liquid than GBTC.
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2024-02-22 17:20:45
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