Big banks believe crypto winter will end in 2023
Last Updated on 6 November 2023 by CryptoTips.eu
The collapse of FTX was nothing short of a pivotal event for the crypto industry, but because of the arrest of founder Sam Bankman-Fried, the major US banks now believe that crypto is due for a revival next year. They think the so-called crypto winter is coming to an end.
All-time-high
After Bitcoin hit an all-time-high of $69,000 last year, the world’s biggest digital coin lost around 75% of its value. Whereas we noticed a pause in the drop during the summer months, the fall of FTX beginning of November was enough to drop Bitcoin to lower levels again.
However, with the worst collapses now out of the way and the Federal Reserve ready to slow down int’s planned interest rate rises, most big banks in the US expect Bitcoin (and other crypto coins) to rise again in 2023.
Marion Labeure of Deutsche Bank said:
Although investors have suffered significant losses, we believe this second ‘crypto winter’ will be a net positive because the FTX collapse will edge the crypto ecosystem closer to the established financial sector.
JP Morgan and Bank of America
Analysts at JP Morgan seemed to agree, declaring in a December note that:
We believe that the Ethereum Merge and really the Ethereum Surge could be a big factor in terms of increasing the use-cases for blockchain into new areas, including financial services.
We continue to see the Ethereum Surge as a catalyst for development in the cryptocurrency markets, which appears at least 6-12 months away.
Even Bank of America said in a research note that:
An increased urgency for regulation may enable greater institutional engagement, and a shift in focus and capital from speculative trading to projects with real-world functionality, and companies with roadmaps to profitability may accelerate industry maturity.
Our view is that we remain in the first innings of a major change in applications that will take place over the next 30 years.