According to the forecasts of JPMorgan analysts, it is expected that Ethereum will surpass Bitcoin by 2024.
Specifically, it is indicated that a potential network upgrade could act as a catalyst to increase Ethereum’s market share.
At the same time, JPMorgan shows a less optimistic outlook on the price of Bitcoin compared to other Wall Street institutions. Let’s see all the details below.
Will Bitcoin be surpassed? JpMorgan’s predictions for 2024
As anticipated, according to JPMorgan analysts, the prospect of an upcoming network upgrade could lead to a bullish trend for Ethereum in the next year.
In their forecasts for the cryptocurrency landscape of 2024, they anticipate that Ethereum will surpass Bitcoin and gain market share.
Specifically, analysts express caution towards the cryptocurrency markets in 2024, but they are optimistic about Ethereum surpassing Bitcoin and other cryptocurrencies in the coming year.
This is mainly thanks to the upcoming EIP-4844 or Protodanksharding.
This latter represents indeed a proposal aimed at reducing transaction costs and increasing the number of transactions per second. Furthermore, it also potentially acts as a catalyst for the recovery of Ethereum’s market share through the enhancement of network activity.
Analysts therefore claim that the following year will be characterized by the reassertion of Ethereum and the reconquest of market shares within the cryptocurrency ecosystem.
Other considerations on Ethereum and Bitcoin’s halving
Despite Ethereum’s 90% increase in value since the beginning of the year, with a current price of $2,270, analysts note that Ethereum’s gains have remained overshadowed by those of Bitcoin.
Indeed, the latter, in fact, has recorded an increase of 154%.
The optimism towards Bitcoin is mainly fueled by the expectation of an imminent regulatory approval of a spot Bitcoin ETF, with the hope that this could improve liquidity and lower entry barriers for new investors.
However, JPMorgan expresses greater skepticism towards bullish prospects for Bitcoin. He suggests that the influx of new capital could be more limited and that, instead, it may be a simple shift of money from other cryptocurrencies.
In addition, JPMorgan analysts aim to dispel the enthusiasm surrounding the Bitcoin halving event scheduled for April of the following year.
Contrary to expectations of a price increase due to the reduction in Bitcoin supply, JPMorgan predicts a 20% decrease in the hash rate after the halving.
This forecast is based on the idea that miners with higher operating costs or less efficient hardware may be forced to leave the market, causing the price of Bitcoin to stabilize around $35,000 after the halving.
Furthermore, some experts from Bitget, a well-known crypto exchange, have expressed their opinions regarding Bitcoin forecasts, stating the following:
“Users are recommended to hold BTC spot for the long term. As for the short-term forecast, a fluctuation in the range of 32,000-50,000 points is predicted.”
SEC redefines rules for Bitcoin ETFs
Recent reports indicate that the Securities and Exchange Commission (SEC) of the United States has introduced a “new regulatory standard” for all applicants of Bitcoin Spot Exchange-Traded Fund (ETF) awaiting approval.
Bloomberg’s chief analyst, James Seyffart, has shared the latest update from the regulatory body on X (formerly Twitter), emphasizing that every applicant for a Bitcoin-based spot ETF will have to comply with this new regulatory framework.
The recent “cash refund model” of the SEC was implemented while Bitcoin ETF issuers were submitting their documents to the SEC for review.
The SEC seems to insist on this model instead of approving alternative proposals from other issuers. The model allows authorized participants to deposit funds in the ETF equal to the net asset value of the creation units to be generated.
Subsequently, the underlying assets, in this case Bitcoin, are purchased by the fund using such funds.
Seyffart shared the update along with a screenshot with further details on the new regulatory model, posting another week from financial lawyer Scott Johnsson.
Johnsson has stated that Invesco is the latest company to adopt this standard for the creation and redemption of liquidity for its ETFs.
The trust provides that creation and redemption transactions will initially be made in cash.
However, it may consider or require creation and redemption operations based on the “in-kind” model in the future. This model was originally suggested by several ETF applicants.
In the “in-kind” model, the participant deposits a set of weighted securities in accordance with the ETF’s portfolio. This allows investors to receive creation units from the fund without having to immediately sell the securities for cash.
Eric Balchunas, senior analyst at Bloomberg ETF, confirmed Invesco’s adoption of this new liquidity model, stating that the company is following the initiative according to the latest updated S-1 document.