Crypto Market Rebound Expected in August, Liquidations to Finish by July-End: JPMorgan

Crypto liquidations should abate this month and the market is expected to rebound from August onward, JPMorgan (JPM) said in a research report on Wednesday.
The bank reduced its year-to-date crypto net flow estimate to $8 billion from $12 billion previously.
The Wall Street firm said it was skeptical that the prior estimate of $12 billion would continue for the rest of the year given how high bitcoin (BTC) was relative to its production cost or relative to the price of gold, the report said.
“The reduction in the estimated net flow is largely driven by the decline in bitcoin reserves across exchanges over the past month,” analysts led by Nikolaos Panigirtzoglou wrote.
This decline in reserves is likely a reflection of bitcoin liquidations by creditors of Gemini or defunct crypto exchange Mt. Gox, or selling by the German government, which has been offloading crypto that it seized from criminal activities, the bank said.
The bank’s reduced estimate of $8 billion is comprised of a $14 billion net flow into crypto funds by July 9, Chicago Mercantile Exchange (CME) futures flows of $5 billion, $5.7 billion of fundraising by crypto venture capital funds year-to-date, minus a $17 billion adjustment to account for the rotation from wallets on exchanges to new spot bitcoin exchange-traded-funds (ETFs).
Read more: Crypto Markets to See Selling Pressure in July From Mt. Gox Creditors: JPMorgan
Edited by Parikshit Mishra.
Disclosure
Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.
Will Canny is CoinDesk’s finance reporter.