Despite recent regulatory headwinds, the cryptocurrency market has risen strongly over the past month with Bitcoin (BTC) outperforming, JPMorgan said in a research report last week. there is
The bank notes that Bitcoin, the largest crypto asset by market capitalization, has risen alongside gold as both are seen as a hedge against a “catastrophic scenario.”
Recent problems in the banking sector have also “exposed weaknesses in the traditional financial system, such as its susceptibility to bank runs,” wrote JPMorgan analysts led by Nikolaos Panigirtzoglou.
“The US banking crisis and significant outflow of funds from bank deposits to money market funds (MMFs) are seen by crypto advocates as proof of the legitimacy of the crypto ecosystem,” the report states. there is
Bitcoin has also benefited from the announcement of Bitcoin’s Ordinals two months ago. There is also an opinion that Ordinals will raise transaction fees and increase income for miners.
JP Morgan says the most significant support for Bitcoin comes from growing investor interest in the mining reward halving event scheduled for April 2024.
“This will mechanically double the cost of Bitcoin production to around $40,000, which will have a positive psychological effect,” the report said. It has acted as a valid floor for prices,” he added.
｜Translation: coindesk JAPAN
｜Editing: Toshihiko Inoue
｜Original: US Banking Crisis May be Vindication for Crypto Ecosystem: JPMorgan