JPMorgan research has provided optimism for the cryptocurrency community by indicating that the recent wave of digital asset selloffs is approaching its conclusion.
The report highlights an increase in Bitcoin futures trading activity, implying potential market stabilization following the recent selloffs. Bitcoin futures are contracts that allow traders to buy or sell Bitcoin at a predetermined price on a future date and are traded on exchanges like the Chicago Mercantile Exchange (CME).
JPMorgan's analysis shows a decline in the number of unsettled and active future contracts on exchanges, suggesting growing interest in acquiring Bitcoin and indicating a potential end to the recent selloff trend. JPMorgan analyst Nikolaos Panigirtzoglou believes this could lead to a market reversal in the near term, stating that there is limited downside for crypto markets.
The exact timing of the reversal remains uncertain, but the report points out a slowing down of price declines, with Bitcoin trading around $25,980 at the time of the report.
Regarding Bitcoin exchange-traded funds (ETFs), JPMorgan's report suggests that they might not significantly impact Bitcoin's price. While Bitcoin ETFs are available in Europe and Canada, they have not attracted significant investor interest. The pending approval of Bitcoin ETFs in the United States by the Securities and Exchange Commission (SEC) might also face delays, potentially pushing the decision into 2024.
