According to a jpmorgan crypto expert, Bitcoin would possibly want to fall below $30,000 before institutional buyers are lured into the market and start increasing value again.
One of the main reasons for the recent drop in bitcoin’s value has been a sharp drop in interest from major players, Nikolaos Panigirtzoglou, managing director and global market strategist at JPMorgan, told Insider.
Panigirtzoglou said major buyers were attracted to bitcoin as the value began to rise in 2021, but said the rise in prices began to stop them.
“I’m afraid we want bitcoin to go below $30,000 for this institutional interest to develop dramatically. “
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Panigirtzoglou’s view differs from that of some strategists, who say a drop below $30,000 would likely lead to further turmoil for bitcoin. Edward Moya, senior market analyst at forex company Oanda, said Tuesday that “a $30,000 breakout can lead to a massive sales momentum shift. “
Bitcoin was trading at around $37,500 on Friday. That’s more than 40% less than April’s record of about $65$000, but it’s about 25% more than at the start of the year.
He highlighted the futures market, where bitcoin futures costs are trading at one point below the spot price. Panigirtzoglou said the recommended call for giant establishments, which use bitcoin futures to disclose themselves, was weak.
Bitcoin soared in the early months of 2021 and at one point was up more than 120% during the year, driven by Tesla which has adopted the cryptocurrency.
Still, the stock began plummeting in May after Tesla boss Elon Musk said the electric car maker would no longer settle for bitcoin as payment because of its “meaningless” energy consumption. A new crackdown through the Chinese government has also soured the mood.
However, Panigirtzoglou said there were symptoms as early as March and April that institutional interest was declining, i. e. in a sharp slowdown in flows to bitcoin products, such as Canada’s exchange-traded funds.
He said that one measure of the recovery in the institutional call would be the increase in futures costs relative to the spot price. Another positive sign would be if bitcoin’s share of the cryptocurrency market started to develop again, having declined in recent months. .