FTX-Binance conflict continues to affect the broader crypto market.
Leading cryptocurrency also dropped 9% in the last 24 hours.
Experts predict a brief downturn for the crypto market.
10% drop in the last 24 hours. In less than a week, the broader cryptocurrency market has lost 20% of its value, or $200 billion.
The latest report from JPMorgan shows that the crypto market is facing a "cascade of margin calls," and the inability to meet them might result in massive market liquidations. As per JPMorgan strategists led by Nikolaos Panigirtzoglou, the Bitcoin price could fall all the way below $13,000 in the near future.
On the weekly chart, the Bitcoin price has already dropped by 21%. At the time of writing, Bitcoin was trading 9.5% down at a price of $16,621, with a market valuation of $315 billion.
The JPMorgan team stated in a report issued on Wednesday (Nov 10): "What makes this new wave of crypto deleveraging driven by the apparent collapse of Alameda Research and FTX more problematic is that the number of entities with stronger balance sheets capable of rescuing those with low capital and high leverage is shrinking in the crypto space.”
JPMorgan on FTX-Led Crypto Bloodbath
The FTX crisis spread throughout the market like a virus. Also, there's a lot of drama in the market, with FTX CEO Sam Bankman-Fried struggling to recruit new investors. A day after announcing their support for acquiring FTX's non-US assets, Binance backed out of the acquisition deal on Wednesday.
Market analysts are also concerned that any probable bankruptcy of FTX could lead to a contagion in other crypto firms. As a result, investors are still processing the FTX incident.
JPMorgan's Bitcoin price projection is based on the cost of Bitcoin production to miners. As we all know, with the Bitcoin price dropping on the one hand and growing energy expenses on the other, miners have been compelled to liquidate their BTC holdings in order to fund their operating costs.
What do you think about JP Morgan’s projection of Bitcoin falling below $13,000? Share your views in the comment section below.