Bitcoin (BTC) Price Reduction Is Predicted To End After Market Corrections

Bitcoin, the world's largest crypto asset by market cap. (Photo; Doc. Unsplash)

JAKARTA - According to analysts from JPMorgan, Bitcoin (BTC) currently has limited potential to experience further price declines after experiencing a correction that brought the cryptocurrency to the level of US$25,000 (Rp382 million).

According to a Bloomberg report, Nikolaos Panigirtzoglou stated that news related to legality and regulation has caused a wave of sales in recent weeks that "still felt the impact."

Panigirtzoglou stated that this decline appears to be in the final phase based on open interest (OI) on Bitcoin futures (futures) contracts at the Chicago Mercantile Exchange (CME).

A large number of OIs on futures contracts usually show a market that is too excited and vulnerable to liquidation waves. While lower OIs can show that most sales pressures have been resolved in the near term.

"As a result, we expect the potential decline in crypto market prices to be limited in the near term," according to Nikolaos Panigirtzoglou.

JPMorgan analysts also revealed that market participants are currently awaiting a decision regarding the Bitcoin Exchange-Trad Fund (ETF) plan and an appeal from the US Securities and Exchange Commission (SEC) against the results of its case against the Ripple payment company.

At the end of 2020, the SEC sued Ripple on charges of selling XRP as an unregistered securities, and only last month they won part of the win.

Anticipation of the appeal filed by the SEC has brought about a "wave of new legal uncertainty" for the crypto market and made them sensitive to further developments.