Weekly SmartPills #37
CRYPTO 2024: JPMORGAN COOLS ENTHUSIASM, ETHEREUM IN THE SPOTLIGHT
Financial giant JPMorgan is issuing a note of caution for the 2024 crypto outlook. A recent report from the institution warns that despite the anticipated approval of spot ETFs for Bitcoin and Ethereum, community enthusiasm may be excessive, with results potentially falling short of expectations. The analysis suggests that the Securities and Exchange Commission (SEC) is unlikely to block the launch of these ETFs, but the gains may not be as impressive as many are hoping for. However, this warning comes with the awareness that the so-called “sell the news” effect could pose a significant risk, especially in the early days of January with the ETF launch. The report also raises concerns about excessive optimism, which may have already pushed Bitcoin into “overbought” territory. The halving event, once seen as a significant price catalyst, has yet to prove its impact, especially as the community adapts to new dynamics. JPMorgan therefore advises caution in interpreting Bitcoin’s growth prospects for 2024.
Ethereum in the Spotlight: Network Upgrades and Growth Potential
Despite a cautious stance on the overall crypto market, JPMorgan views Ethereum as the asset with the greatest potential in 2024 — even surpassing Bitcoin. This outlook is supported by expectations of upcoming technological improvements to the Ethereum network aimed at enhancing its scalability. In particular, the EIP-4844 upgrade and the development of sharding (specifically protodanksharding) are highlighted as key factors that could significantly improve transaction speed. According to JPMorgan, these technical developments could further strengthen Ethereum’s position in the crypto landscape, justifying the increased focus on the asset in the year ahead.
Uncertainties in VC Funding and DeFi in Q4 2023
JPMorgan expresses uncertainty regarding funding in the fourth quarter of 2023, especially in the context of new VC investments. Although DeFi is showing signs of growth, the analysis suggests that its inability to penetrate the traditional financial system remains the main obstacle for DeFi — a necessary element for integrating the crypto ecosystem into the real world. The 2024 crypto landscape appears to be a complex terrain, where enthusiasm is accompanied by a call for caution, with Ethereum emerging as a promising contender.