JPMorgan Predicts Ethereum Will Lag Behind Bitcoin

Bitcoin continues to outpace Ethereum and other altcoins despite recent market changes.

The market’s rise following the recent escalation of conflict in the Middle East has not altered the overall trend: Bitcoin continues to outpace Ethereum and other altcoins. This conclusion was reached by analysts at JPMorgan, reports The Block.

According to the bank, digital gold is recovering more swiftly—both in the spot ETF segment and in the futures market. Institutional investors are more actively returning to the leading cryptocurrency: inflows into Bitcoin funds have compensated for two-thirds of the recent outflows, whereas Ethereum ETFs have only managed a third.

Open positions on the CME for Bitcoin have returned to peak levels, while interest in Ether remains low.

Experts doubt that the hard forks Glamsterdam and Hegota planned for this year will rectify the situation. Previous network updates over the past three years have not resulted in a noticeable increase in activity—on the contrary, they have reduced transaction costs in L2 solutions, which decreased the volume of burned fees and increased the supply of coins. This has exerted additional pressure on Ether’s price.

Analysts attribute the weakness in the altcoin market since 2023 to three factors:

• low liquidity and insufficient market depth;
• stagnation in the decentralized finance sector;
• regular hacks and security issues.

These factors have undermined investor confidence and are restraining the influx of new capital into the alternative cryptocurrency ecosystem. The situation is unlikely to change without a sharp increase in activity in real-sector applications and DeFi, JPMorgan concluded.

Back in May 11, digital gold prices tested $82,000, yet traders continued to exercise caution.