Investors face an uncertain situation while the signals issued by financial institutions are becoming more and more cautious. With a marked decrease in the interest of institutional actors in term contracts on Bitcoin and Ether, market dynamics seem to run out of steam. JPMorgan thus alerts the risks of new corrections, which could affect the stability of the short -term crypto courses.
A lowering signal for the cryptos market
The cryptocurrency market is going through a period of uncertainty. According to JPMorgan analysts, the institutional demand for term contracts on Bitcoin and Ether, listed on the Mercantile Chicago Exchange (CME), shows signs of weakening. This trend, deemed down by the bankcould weigh on the prices of short -term cryptos.
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According to a report published Wednesday by Nikolaos Panigirtzoglou, Managing Director at JPMorgan, The total market capitalization of cryptocurrencies fell 15 %going from its historic record of 3.72 dollars trillion recorded on December 17 at around 3.17 trillions of dollars today.
This decrease is accompanied by a phenomenon of “backwarding” on term contracts Bitcoin and ether, a situation where future prices fall under cash prices.
When the demand for these contracts is strong, These tend to exchange at a higher price To that of the cash market, a state called “Contango”.
However, the withdrawal of institutional demand leads to a reversal of this trendsignaling a lack of optimism on the evolution of Bitcoin and Ethereum prices.
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A request weakened by the absence of positive news
According to JPMorgan experts, 2 main factors explain this withdrawal of institutional demand. First of all, many institutional investors seem to take their profits in the face of a lack of positive short -term signals.
Unlike the start of the year marked by the nomination of Donald Trump at the White House and pro-Cryptos declarations, the current US administration does not provide No major measures in favor of cryptocurrencies before the 2nd half of the yearwhich promotes observation rather than action in this very volatile market.
Finally, the funds, such as the Commodity Trading Advisors (CTA), Gradually reduce their exposure to cryptosthus accentuating the drop in demand. Momentum signals from Bitcoin and Ether have deteriorated in recent weeks, the Ether now displaying a clearly negative trend.
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These latest trends suggest that the markets of cryptocurrencies could Continue to suffer downward pressure in the short term. Without a renewed institutional interest or a change of feeling, current fragility could intensify, putting investors in the face of increased volatility in the coming weeks.
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