JP Morgan CEO Says More Pain Ahead For Bitcoin, Ethereum, Cardano Investors
The decline of the crypto market has been expected, especially for top digital assets such as Bitcoin, Ethereum, and Cardano. The fall has hit the market hard, especially with the collapse of one of the leading DeFi protocols, the Terra network. However, JP Morgan CEO, Jamie Dimon, believes that it is only beginning. Despite the market is more than 50% down from its all-time high, the bank executive says there are worse roads ahead.
JP Morgan CEO Says Brace For Impact
Jamie Dimon has not been the best supporter of cryptocurrencies. Nevertheless, the bank which he heads as CEO, JP Morgan, has been easing its stance towards digital assets and has moved forward with various plans to provide its customers with cryptocurrency trading options. With the crypto market and given that there is now exposure to the market to a certain degree, Dimon has come forward to explain that the bank is expecting more decline.
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The CEO made the stance known at a financial services conference where he explained that an ‘economic hurricane’ would rock the market. Obviously, something like this would ripple through all of the financial markets and the crypto market will not be spared.
BTC price recovers above $31,000 | Source: BTCUSD on TradingView.com
Dimon has advised cryptocurrency investors to “brace yourself” as he expects market volatility. This is due to the fact that the Fed will begin implementing its “quantitative tightening” policies which will see the Fed removing liquidity from the market.
“I said they’re storm clouds,” Dimon warned. “They’re big storm clouds here. It’s a hurricane [and] that hurricane is right out there down the road coming our way. We just don’t know if it’s a minor one or Superstorm Sandy.”
The Crypto Market
Looking at the charts, it doesn’t take an expert to see that the crypto market has had a rough first half of 2022. The largest and most established coins in the cryptocurrency market are all down at least 50% such as Bitcoin and Ethereum, and more in the case of Cardano and Binance Coin.
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This crash has seen more than $1 trillion wiped off the market in less than a year and if Dimon is right, this may only be the beginning. If the Fed does begin the quantitive tightening and sucks liquidity out of the market, that would affect the buying power of most investors, causing more money to leave cryptocurrencies.
Such a decline could set the market back by a couple of years, putting it in the territory of 2020 lows. If the crypto market continues following the trend of the stock market, which has been in a steady decline this year, a sharp decline in liquidity would see the stock market rocked considerably, triggering an adverse effect in the crypto market.
Featured image from Inc. Magazine, chart from TradingView.com
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