J.P. Morgan Analysts Skeptical of Crypto Market's Recent Surge

According to a report by The Block, J.P. Morgan analysts, led by Nikolaos Panigirtzoglou, have expressed skepticism about the recent surge in the cryptocurrency market, suggesting that the rally might be overdone. Their research note, dated 8 November, identifies two primary factors believed to be influencing the market’s recent performance.

As per The Block’s coverage, the first factor is the anticipation of a spot bitcoin ETF approval in the U.S. The JPMorgan analysts, however, are doubtful about this leading to a significant influx of new capital into the crypto markets. They argue, as The Block notes, that the approval might lead to a reallocation of existing investments from current Bitcoin products rather than attracting fresh capital. They also reference the limited interest in similar ETFs in Canada and Europe, as reported by The Block, to support their skepticism.

The second factor, according to The Block’s article, is the perceived defeat of the SEC in its legal cases against Ripple and Grayscale. However, JPMorgan analysts apparently remain uncertain about any significant easing of crypto regulations in the U.S., given the largely unregulated nature of the crypto industry and recent events like the FTX fraud.

The analysts wrote:

It is far from clear that the regulatory tightening of the crypto industry will lessen significantly going forward given how unregulated this industry is. U.S. crypto industry regulations are still pending and we do not believe U.S. lawmakers would shift their stance because of the above two legal cases especially with the memories from the FTX fraud still fresh.

The Block also mentioned the JPMorgan analysts’ views on the upcoming Bitcoin halving event in April/May 2024. The analysts believe this event is already factored into the current bitcoin price, suggesting that the market has already priced in the potential impact of the halving.

Cointelegraph reported earlier today that JPMorgan has introduced a programmable payment feature for institutional clients on its private blockchain platform, JPM Coin. This announcement, initially reported by Bloomberg and shared by Naveen Mallela, head of JPMorgan’s Onyx blockchain platform, marks a significant advancement in the bank’s blockchain capabilities.

The new feature allows for real-time, programmable treasury functions and the creation of innovative digital business models. Mallela has lauded this development as a crucial milestone for JPM Coin, referring to the programmability aspect as the “holy grail” for their blockchain platform. The Onyx team, in communication with Cointelegraph, emphasized that this programmable payment feature, a long-standing goal in the payments industry, is a pioneering initiative by a global commercial bank.

This solution is designed for blockchain-based accounts within the JPM Coin System. It enables users to set up payments through an “If-This-Then-That” interface, offering a new level of control and automation. Siemens AG, a prominent German technology company, has already implemented this feature, with other major corporations like FedEx and Cargill expected to follow suit by the end of 2023.

The programmable payments allow for various automated functions, including dynamic funding, which facilitates the creation of rules for automatically funding a bank account to prevent shortfalls. Additionally, it supports event-based payouts, enabling payments triggered by specific events like margin calls or the delivery of goods and services. Mallela highlighted that this innovation is a significant step towards realizing dynamic and event-driven financial operations through blockchain technology.

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