JP Morgan has poured cold water on hopes of a crypto bull run next year, with the bank’s analysts taking a “cautious” stance in their 2024 crypto outlook.

Analysts led by Nikolaos Panigirtzoglou said in a newly published report that the Bitcoin halving is “largely priced in,” since the halving event and its effect on the Bitcoin supply are “predictable and in our opinion are well factored into the current bitcoin price.”

The team argued that based on the current Bitcoin hash rate and mining difficulty, that the production cost for miners would rise from around $22,000 at present to around $44,000 post-halving.

Bitcoin’s current price of around $42,000 is consistent with a 5% drop in the post-halving hash rate, which “seems too low,” with the team anticipating a 20% drop in the hash rate and miners with higher overheads exiting the market.


Since the 2020 halving brought Bitcoin's price to a 1:1 ratio with miners’ production cost, and the current Bitcoin price is around twice the production cost, it implies that the 2024 halving is largely priced in, the report suggested.

Ethereum could “outperform” Bitcoin in 2024, the report said, pointing to the EIP-4844 “Protodanksharding” upgrade as a potential catalyst, but raised concerns about centralization of staking on the Ethereum network.

The report cautioned that it is “too early to be getting excited” about a revival of DeFi and NFT activity, while pointing to the “encouraging” rise of new DeFi chains including Aptos, SUI and Pulsechain, and the “renewed interest” in NFTs prompted by the emergence of Bitcoin Ordinals.

A Bitcoin ETF flop?

JP Morgan analysts also expressed skepticism that the long-anticipated approval of a spot Bitcoin ETF would bring fresh capital to the market.


The report cited both the lack of interest from investors in already-approved spot ETFs in Canada and Europe, and the likelihood that capital would move into spot Bitcoin ETFs from existing Bitcoin products, such as the Grayscale Bitcoin Trust (GBTC), Bitcoin futures ETFs and Bitcoin mining companies.

The report argued that as much as $2.7 billion could exit GBTC following its conversion to a spot Bitcoin ETF, as investors take profit. Were those funds to exit the market rather than moving into other Bitcoin instruments, it would put “severe downward pressure” on the price of Bitcoin, analysts said.

JP Morgan and crypto

The JP Morgan report comes just a week after the firms’ CEO, Jamie Dimon, took aim at crypto in a Senate Banking Committee hearing, saying that he would “close it down” if he were the U.S. government.

Dimon claimed that, “The true use case for it [crypto] is criminals, drug traffickers, money laundering, tax avoidance,” adding that, “I’ve always been opposed to crypto, Bitcoin, etcetera.”

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