Cryptocurrency to Have Limited Upside Down Due to Decline in Stablecoins Share Prices: JP Morgan

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In a current outlook published on March 30, JP Morgan highlighted that the crypto market would experience a limited upside down ahead as the prices of stablecoins falls. Currently, the share of stablecoins is not very high. In fact, it has decreased to below 7% from 10%, as noted by Nikalaos Panigirtzoglou, amounting to the share price of 2020.

JP Morgan predicts the slowdown of the cryptocurrency market

In a report published by the JP Morgan analyst, he believes that ongoing rise to glory of the crypto market amidst the current economic situations could slow down a bit. He also noted that the decline in stablecoins could severely impact any further growth or upside of the crypto market. JP Morgan also pointed out that the sanctions imposed on Russia amidst the Ukrainian crisis was considered to significantly boost the adoption and usage of different cryptocurrencies as the traditional banking systems and procedures turn obsolete.

And to some extent, this is a reality, with more and more countries launching their own nationalized version of cryptocurrencies. In fact, the stringent rules and sanctions imposed were even followed by a 30% rise in the price surge of Bitcoin and Ether in March. This was a major uplift considering the price slump of cryptocurrencies in February 2022.

JP Morgan’s proxy-based position for Ethereum

As the short covering for Ethereum was higher, the price pushed the bank position proxy in the CME Ethereum. Short covering refers to buying back all the borrowed securities in order to settle an open short position of profit and loss. However, despite these positive developments, JP Morgan believes that decrease in the share price of stablecoins signals a slowdown in the current climb of the cryptocurrency market.

Nitish Vaibhav
Nitish Vaibhavhttp://thetradingbay.com
Nitish Vaibhav is the Founder of the The Trading Bay. A computer science engineer turned an Entrepreneur 5 years ago. He has been in trading since 4 years in Forex and Crypto using his price action strategies. Involved in Content Creation full time for 3 years, Nitish is top rated writer on many content writing websites. He is also a YouTuber in India making videos about Crypto and Forex.

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