• JPMorgan Chase & Co. has predicted that the US will face a recession in the second half of 2023 and that the price of bitcoin could drop by 25%.
• They cite the collapse of $SI and deterioration in demand as signs that recovery may be difficult and drawn out.
• JPMorgan also sees progress in two key areas – stablecoins expansion and venture capital investments – as necessary for changing its outlook on digital assets.
JPMorgan Chase & Co., a multinational financial services corporation based in the United States, is the largest bank in both the US and world market. Despite taking an optimistic approach to cryptocurrencies initially, analysts at JPMorgan have now warned that Bitcoin could plunge to $13k amid deterioration in demand and Silvergate collapse. In addition, they forecasted a US recession beginning later this year.
Analysis Of The JP Morgan Report
American journalist Carl Quintanilla reported on his Twitter thread about JPMorgan’s remarks on FTX disaster being yet „another setback for cryptocurrency ecosystem,“ along with predicting difficulty replacing immediate network for processing dollar deposits and withdrawals. Furthermore, JPMorgan pointed out reversal in futures spread as another sign of decline in demand. The bank holds a negative outlook on digital assets which hints at slow road to recovery from hereon.
Stablecoins Expansion & Venture Capital Investments
JP Morgan believes that before it can change its pessimistic view towards digital currencies, there must be significant progress shown on two essential aspects: expansion of stablecoins and rate of venture capital investment into cryptocurrency market. This indicates that only when these two points are met can there be hope for any kind of appreciation in crypto prices again.