One of the largest investment banks, JPMorgan, has published its fresh investor notes, revealing crypto markets are “looking frothy” once again.
According to JPMorgan, the market bubble is the result of a sharp increase in demand for cryptocurrencies from retail investors, which in turn was brought about by historically low interest rates, as well as favourable forecasts for the rest of the year expressed by the US Federal Reserve System (FRS).
Analysts at JPMorgan estimated a net flow of $13 million (~£9.4 million) into the US stock market in August, while in July, it reached $16 million (~£10.8 million). Such an influx of capital heavily influenced the virtual assets market, spurring another round of the crypto frenzy at the end of summer.
Back in May, Bitcoin and Ethereum reached their all-time highs followed by a sharp fall of more than 50% in early June. However, at the end of July, the prices finally began to recover, as reflected in the six-month chart of Bitcoin and Ethereum presented on Tradingview.com.
JPMorgan reports that Bitcoin continues to lose market dominance, giving way to altcoins which are gaining momentum rapidly.
The success of the leading cryptocurrencies is not even close to that of altcoins and non-fungible tokens (NFTs), since their popularity is currently surging at a tremendous pace. For example, Solana (SOL) has already set several new records, with its shares having grown by 7,000% since the beginning of the year.
Meanwhile, Bitcoin dominance is fading away due to the growth of Ethereum, Cardano (ADA), Ripple (XRP) and Binance Coin (BNB). At the moment, the total share of BTC in the crypto market cap is slightly over 40%, while at the beginning of 2021 it reached almost 75%. This is evidenced by the chart of Bitcoin’s market dominance displayed on Traidingview.com.
The JPMorgan research group reports that altcoin trading currently accounts for about a third of the overall cryptocurrency market, which is 22% more than a month ago. However, the analysts believe it’s not a whole new trend gradually gaining popularity, but a good old economic bubble.
JPMorgan has recently published its investor notes, stirring up concerns among crypto market players. However, despite this overall anxiety about the digital asset market’s fate, there are now no signs that the ongoing rapid growth of cryptos may slow down in the foreseeable future.
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Ingénieur de formation, et spécialisé dans les nouvelles technologies, je me suis toujours intéressé à la blockchain et aux cryptomonnaies. Je suis heureux de faire partie de l'équipe CoinTribune.
The views, thoughts, and opinions expressed in this article belong solely to the author, and should not be taken as investment advice. Do your own research before taking any investment decisions.
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