International investment bank JPMorgan forecasts that the bitcoin price slump will likely end when the cryptocurrency’s dominance rises above 50%. “I think that’s another indicator to keep an eye on here in terms of whether or not this bear phase is over,” the firm’s analyst explained.
Bitcoin Market Prediction from JPMorgan
JPMorgan analyst Nikolaos Panigirtzoglou has shared his thoughts on when the current bitcoin bear market will end. In an interview with CNBC on Tuesday, the analyst stated that the bitcoin price slump will likely end when the cryptocurrency’s market share of all cryptocurrencies returns to greater than 50%. He elaborated:
In terms of the share of bitcoin as a percentage of the total cryptocurrency market cap, a healthy number is 50% or higher. That, I believe, is another indicator to keep an eye on in order to determine whether or not the bear market has ended.
“It was like 60 percent back in the beginning of April,” the JPMorgan analyst recalled, adding that bitcoin’s low market share is a negative signal that suggests interest in BTC is still low. Panigirtzoglou, on the other hand, noted that bitcoin’s market share had increased in recent weeks.
Bitcoin currently has a 46 percent market share, and the price of BTC is $34,609 at the time of writing, according to data from Bitcoin.com Markets.
While the JPMorgan analyst sees little evidence of large investors buying the bitcoin drop, he did note:
The flow into ethereum funds has slowed in the last two to three weeks, while the flow into bitcoin funds… has increased. That implies that some institutional investors may be seeing a relative value opportunity to buy bitcoin and sell other cryptocurrencies.Another JPMorgan analyst stated last week that the cryptocurrency market is healing but is not yet healthy. Furthermore, the analyst described the crypto market’s near-term outlook as “challenging,” warning of further sell-offs.
Panigirtzoglou stated earlier this month that the bitcoin futures trend was experiencing “an unusual development.” “We believe that the recent return to backwardation is a negative signal pointing to a bear market,” he wrote.
Meanwhile, JPMorgan CEO Jamie Dimon stated last month during congressional testimony before the House Financial Services Committee about cryptocurrency that his personal advice to people is to avoid bitcoin. Nonetheless, he admitted that JPMorgan’s clients want to be exposed to cryptocurrency.
