JPMorgan Predicts Bitcoin Potentially Drops to 13,000 US Dollars, Crypto Market Will Be Bloody Again?

Bitcoin prices dropped drastically. (Photo; Doc. Bithub)

JAKARTA – The collapse of Sam Bankman-Fried's crypto exchange, FTX, has spread to the entire crypto market, which has fallen 10 percent in the last 24 hours. Meanwhile, in one week, 200 billion dollars, or around IDR 3.1 Quadrillion should disappear from the market, according to CoinMarketCap data.

According to US investment giant JPMorgan, the crypto market is experiencing a “cascade margin call.” If it fails to meet it then it has the potential to lead to a massive liquidation in the crypto market. That way, JPMorgan strategist Nikolaos Panigirtzoglou says the Bitcoin price could plunge to $13,000 per BTC.

Not long ago, the price of BTC was down 20 percent on its weekly chart. At press time, Bitcoin is down 11.75 percent to trade at $16,143 with a market cap of $309 billion.

“What makes the new phase of deleveraging of cryptocurrencies caused 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,” according to a report from JPMorgan published on Wednesday, November 9, 2022.

The negative impact of the FTX collapse is spreading everywhere. FTX founder Sam Bankman-Fried struggled to find investors to help restore his company. Crypto trading giant Binance has also reportedly pulled back from its plans to acquire FTX.

Now market analysts have strong fears that FTX's potential bankruptcy could cause a contagion to other crypto companies. As a result, investors are still observing the condition of the FTX.

Coingape reports JPMorgan predicts further Bitcoin price declines based on Bitcoin production costs for miners. As is well known, with the decrease in the price of Bitcoin on the one hand and the increase in energy costs on the other, miners are forced to liquidate their BTC holdings to cover their operational costs.

"Currently, this production cost is at $15,000, but will likely revisit the $13,000 low seen for several months in the summer", JPMorgan said.

At the time of writing, Bitcoin is trading at $16,650 per BTC. Bitcoin price has decreased by 10.7 percent in the last 24 hours. In one week Bitcoin plunged 17.4 percent, according to Coingecko data.