JPMorgan analysts analyze the key catalysts that could affect the cryptocurrency market in the coming months, including the seasonal "Uptober" trend, the Federal Reserve's interest rate cut, the listing of Bitcoin ETF options and the Ethereum "Pectra" upgrade. While historical trends and structural developments offer potential, the market remains sensitive to macroeconomic factors and awaits clearer growth catalysts.
Cryptocurrencies rose more or fell less in October
Based on past historical trends, Bitcoin’s strong performance in October is often called an “Uptober.” Bitcoin had positive returns in October more than 70% of the time.
Although previous performance does not represent future performance, JP Morgan analysts believe that the psychological expectations of "Uptober" may affect the performance of Bitcoin and lead to positive Bitcoin performance in October this year.
The Fed’s interest rate cuts have not yet been transmitted to cryptocurrencies
Although the Federal Reserve has begun a cycle of interest rate cuts recently, it has not seen the expected positive impact on the cryptocurrency market. A falling interest rate environment is typically supportive of riskier assets, but the correlation between total cryptocurrency market capitalization and the federal funds rate remains weak (currently at just 0.46). JP Morgan believes the market may be waiting for more sustained stability before making a decisive shift.
However, analysts also admit that crypto-assets actually only emerged in the early to mid-2010s. The lack of relevant historical data makes it difficult to predict how cryptocurrencies will respond to interest rate cycles, and crypto-assets have had interest rates for most of their existence. All close to zero.
Bitcoin ETF options could deepen market liquidity
The U.S. Securities and Exchange Commission (SEC) approved the listing and trading of BlackRock Bitcoin Spot ETF (IBIT) options, or options, in late September, which analysts expect could deepen liquidity and attract new participants Enter the market. They pointed out:
Through options, investors can now participate in ETFs in a more dynamic way and drive liquidity in the underlying assets.
Such developments could start a positive feedback loop, strengthen market structures and make digital assets more accessible to institutional investors. However, the commodity also requires approval from the Office of the Comptroller of the Currency (OCC) and the Commodity Futures Trading Commission (CFTC).
(SEC approves IBIT option listing, what impact will it have on Bitcoin?)
Pectra upgrade could have long-term impact on Ethereum
Ethereum’s Pectra upgrade, planned for early 2025, is expected to bring changes to Ethereum’s functionality, but analysts believe the upgrade is more structural than an immediate price catalyst.
The long-term impact of Pectra will be to increase Ethereum’s operational efficiency and adoption, but it is unlikely to trigger a short-term surge in the price of Ethereum.
(What are the main risks of the Ethereum Pectra upgrade?)
Increasingly sensitive to macro factors, crypto markets await next catalyst
JPMorgan Chase believes that the crypto ecosystem is increasingly sensitive to macro factors, and that the cryptocurrency market is currently in "holding mode" and is waiting for clearer macroeconomic or structural catalysts to promote its continued growth.
This article JPMorgan Chase: The crypto market is becoming increasingly sensitive to macro factors and is waiting for the next catalyst to arrive first appeared on Chain News ABMedia.
