The analysis of JPMorgan: the post-halving prospects of Bitcoin

JPMorgan predicts a price drop of Bitcoin after the halving. According to the bank’s analysis, the cryptocurrency remains in an overbought state. The report suggests that miners will be particularly affected by this event.

Let’s see below all the details. 

The impact of the halving on Bitcoin valuation according to JPMorgan’s vision

As anticipated, the financial giant of Wall Street, JPMorgan, has predicted that the price of Bitcoin (BTC) could weaken after the reward halving.

This quadrennial event, which slows down the growth rate of Bitcoin supply, seems imminent, with an estimated date around April 19-20, according to a research report published on Wednesday.

The bank indicates that the world’s largest cryptocurrency could undergo a post-halving correction as the current market remains in a state of overbought, as indicated by the analysis of open interest in Bitcoin futures.

Furthermore, Bitcoin’s current price of about $61,200 still exceeds the regulated comparison for bank volatility with gold, which is set at $45,000. 

On the other hand, the expected production cost is $42,000 after the halving. Historically, the production cost of Bitcoin has represented a lower limit for its prices.

JPMorgan also notes that, despite the recent resurgence of the cryptocurrency market, venture capital funding remains modest. The main impact of the halving will be felt by mining companies. 

Analysts led by Nikolaos Panigirtzoglou predict a significant drop in hashrate and consolidation among Bitcoin miners with a larger share for those listed on the stock exchange, as unprofitable miners will leave the Bitcoin network.

Following the halving, some Bitcoin mining companies may also seek to diversify their operations in regions with lower energy costs, such as Latin America or Africa, to extract value from their inefficient facilities that would otherwise remain inactive.

The imminent danger of selling out

Bitcoin (BTC) has recently plunged below its recent high, raising fears of a significant sell-off. 

The analyst Ali Martinez warns about the dangers of a crucial price level that could trigger massive liquidations in the cryptocurrency market.

In particular, Martinez has identified a critical point of price for Bitcoin (BTC), the overcoming of which could trigger a cascade of liquidations.

Understanding the implications of the price of $50,500 becomes crucial for both traders and investors.

We remind you that liquidations occur when traders with open leveraged positions do not have enough funds to support those positions, leading to their forced closure. 

This can further fuel market recessions, creating a cycle of negative feedback. Martinez’s analysis highlights the risk of a massive sell-off in case Bitcoin were to further decline.

The current downward trend of Bitcoin has brought its price below $62,000, with significant risks. Market data indicates consistent liquidations in the last 24 hours, which have mostly affected long positions.