JP Morgan’s latest forecast for the crypto landscape in 2024 diverges from the prevailing optimism, predicting that Ethereum (ETH) will surpass Bitcoin (BTC) in the coming year. This forecast comes amidst a generally “cautious” outlook for the cryptocurrency industry, indicating a potential shift in the balance of power between the two leading digital assets.
JP Morgan’s analysts, despite acknowledging the imminent Bitcoin halving event, remain skeptical about the pioneer cryptocurrency’s performance in 2024. They attribute this caution to the “excessive optimism” surrounding Bitcoin, suggesting that the upcoming halving is already heavily factored into the current valuation.
Bitcoin’s struggle for mainstream acceptance throughout 2022 and early 2023 is well-documented, with the entire crypto industry experiencing a prolonged winter. Despite recent excitement fueled by expectations of the Spot Bitcoin ETF approval and the approaching halving, JP Morgan’s skepticism stands out.
The bank highlights the potential challenges posed by the halving event, anticipating a doubling of production costs for miners based on current hash rates and mining difficulty. A projected 20% decrease in hash rates could force over-costed miners out of the market, undermining the anticipated positive impact of the halving.
Contrastingly, JP Morgan points to Ethereum’s EIP-4844 “Proto-dank sharding” update as a potential catalyst for the altcoin’s superior performance in 2024. However, they express concerns about centralized mining within the Ethereum network, injecting a note of caution even in their optimism about Ethereum.
As the crypto community eagerly awaits 2024, this unexpected prediction from JP Morgan introduces an element of uncertainty, challenging prevailing narratives about Bitcoin’s unquestionable dominance in the digital asset space.
Source: watcher.guru