[ad_1]
Global investment bank JPMorgan says cryptocurrency markets are “looking frothy” as retail investors spill over from the stock market into cryptocurrencies and non-fungible tokens (NFTs).
Crypto Markets Look Frothy, According to JPMorgan
JPMorgan published a note Wednesday on the stock market and cryptocurrencies. It explains that retail investors bought stocks at a record pace over the summer with an estimated net flow into the U.S. stock market of $13 billion in August after reaching a record high of almost $16 billion in July.
The JPMorgan analysts asserted that the stock-buying frenzy spilled over into altcoins and non-fungible tokens (NFTs) in August, and the surge in NFTs and decentralized finance (defi) activity has boosted the price of certain cryptocurrencies, such as ethereum, solana, and cardano.
They wrote:
Cryptocurrency markets [are] looking frothy again.
As Bitcoin.com News reported, the crypto market gained approximately 83% in value over the last three months, led by altcoins. The global crypto market cap is currently $2.28 trillion. Bitcoin’s dominance slipped from 47% on Aug. 1 to 41.39% Saturday. Ethereum (ETH) currently represents 20.13% of the entire crypto market, followed by cardano (ADA) at 4.11%. Solana (SOL) represents 1.80%.
Solana has become one of the top-performing cryptocurrencies this year. At the price of $141.04 per coin, SOL is now the seventh-largest crypto by market capitalization. The coin gained 310.8% during the last month and 3,277.6% year-to-date.
The JPMorgan analysts noted that altcoin trading now represents about 33% of the crypto market, emphasizing that it was a big increase from the 22% reading in early August. They concluded:
The share of altcoins looks rather elevated by historical standards and in our opinion it is more likely to be a reflection of froth and retail investor ‘mania’ rather than a reflection of a structural uptrend.
What do you think about the comments by JPMorgan’s analysts? Let us know in the comments section below.
Image Credits: Shutterstock, Pixabay, Wiki Commons
Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.
[ad_2]
Source link
