Financial analysts from JPMorgan have developed a positive expectation for the cryptocurrency market, projecting substantial growth into 2025. Their optimistic prediction stems from several key factors, such as a potential resurgence of Donald Trump to the U.S. presidency, which they believe could significantly sway investor attitudes and market dynamics.
Forecasts suggest that investors are likely to pivot towards alternative asset classes like gold and bitcoin as a hedge against economic instability, especially in light of escalating geopolitical tensions and the impending U.S. election. JPMorgan analysts suspect that these speculative shifts may exclude ether, however. The analysts also predict that, should Trump reclaim the presidency, it could amplify the trend to alternative asset classes driven by geopolitical tension-related tariffs and an expansionary fiscal policy.
The bullish outlook on digital assets also considers recent actions by traditional wealth advisors such as Morgan Stanley, which is now allowing the recommendation of spot bitcoin ETFs to its clients. Furthermore, the majority of liquidations connected to the bankruptcy of Mt. Gox and Genesis as well as the German government’s bitcoin sale are thought to be mostly resolved, with potential reinvestment into cryptocurrencies from cash payments arising from the FTX bankruptcy.
While the market cap of stablecoins is on an upswing, nearing its former peak of around $180 billion, uncertainty remains regarding U.S. stablecoin legislation. Analysts predict further adoption and growth when these regulations are implemented, a step which is expected to occur in 2025. However, only U.S.-compliant stablecoins are expected to benefit from these regulations, while others face potential challenges.
JPMorgan’s analysts note that despite the expansion of the stablecoin market in US dollar terms, this growth mainly mirrors the general uplift in the crypto market cap, with little variation in stablecoins’ market share relative to overall crypto. Finally, with bitcoin’s price standing at approximately $67,000, it is currently operating well beyond JPMorgan’s average estimated production cost of $47,000.