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Ethereum maintains bullish run as Bitcoin struggles to bounce back, JPMorgan explains why

John KumiBy 0Edited by Steve Msoh 29. April 20213 Mins Read
How to buy Ethereum
Source: Wit Oszweski - Shutterstock
  • Ether has shown more resilience in the recent liquidity shock.
  • The altcoin has been projected to continue its impressive run by America’s largest bank.

Ethereum has in the last 12 months surged by 1,283 percent, and in the last 30 days gained 50 percent. This has sent the price to an all-time high of $2,736. Bitcoin on the other hand has drifted away from its all-time high of $64,000 in the last couple of weeks and lost some of its dominance. In the last 30 days, the digital asset has lost over 6% of its value to trade at a current price of $54,000. According to JPMorgan, the market run by Ethereum can be linked to three main factors:

Ethereum demand

According to JPMorgan, Ethereum has finally overtaken Bitcoin in terms of demand for its utility. Ethereum was designed to facilitate transactions at a higher speed than Bitcoin on the public blockchain. Today, this is paying off. Ether is more liquid at 11 percent compared to Bitcoin at 4 percent according to the bank.

“In a market with significantly higher spot turnover, it is plausible that the underlying base of long exposure is less reliant on leverage in the form of futures and swaps,” the bank stated. 

Liquidity shock in the crypto market

Last week, the cryptocurrency market was hit by a liquidity shock in which only a few survived. Bitcoin was massively affected compared to Ether. According to JP Morgan, the liquidity shock came from the derivative market, largely affecting Bitcoin futures and causing a 23 percent ex-ante open interest. The net long liquidation of Ether since the market pulled back was 17 percent. JPMorgan lauded the dramatic comeback by Ether compared to the rate at which the other cryptocurrencies added value in their recovery process. 

Data from CoinMarketCap confirms that Ether has gained 10 percent value in the last 7 days while Bitcoin has gained just 0.02 percent in the same period. BNB, one of the best-performing assets in the last couple of weeks has also gained just 2 percent value in the same period. 

Less reliance on derivative markets

JPMorgan explained that Ethereum has shown less reliance on the derivatives market than Bitcoin. This is laudable in a market with significantly higher spot turnover. 

The bank observed that Ether has the potential to outperform Bitcoin in the future. Ether has been tipped to enter the $3,000 price zone as the intermediary-term momentum is strong. Similarly, the long-term momentum looks bullish. The early month breakout from the technical point of view is said to be a bullish bias beyond the coming weeks. 

 

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This article is provided for informational purposes only and is not intended as investment advice. The content does not constitute a recommendation to buy, sell, or hold any securities or financial instruments. Readers should conduct their own research and consult with financial advisors before making investment decisions. The information presented may not be current and could become outdated.

John is a seasoned cryptocurrency and blockchain writer and researcher, boasting an extensive track record of years immersed in the ever-evolving digital frontier. With a profound interest in the dynamic landscape of emerging startups, tokens, and the intricate interplay of demand and supply within the crypto realm, John brings a wealth of knowledge to the table. His academic background is marked by a Bachelor's degree in Geography and Economics, a unique blend that has equipped him with a multifaceted perspective. This diverse educational foundation allows John to dissect the geographical and economic factors influencing the cryptocurrency market, offering insights that go beyond the surface. John's dedication to the crypto and blockchain space is not merely professional but also personal, as he possesses a genuine passion for the technologies that underpin this revolutionary industry. With his astute research skills and commitment to staying at the forefront of industry trends, John is a trusted voice in the world of cryptocurrencies, helping readers navigate the complex and rapidly changing terrain of digital assets and blockchain innovation. John Kiguru is an accomplished editor with a strong affinity for all things blockchain and crypto. Leveraging his editorial expertise, he brings clarity and coherence to complex topics within the decentralized technology sphere. With a meticulous approach, John refines and enhances content, ensuring that each piece resonates with the audience. John earned his Bachelor's degree in Business, Management, Marketing, and Related Support Services from the University of Nairobi. His academic background enriches his ability to grasp and communicate intricate concepts within the blockchain and cryptocurrency space. Business Email: info@crypto-news-flash.com Phone: +49 160 92211628

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