Not only ETFs. How retail traders influenced the growth of the crypto market
JPMorgan: Retail traders significantly impacted the growth of cryptocurrencies in February
JPMorgan analysts have linked the February rise of Bitcoin to the activity of retail investors ahead of the upcoming halving and the launch of Bitcoin-based exchange-traded funds (ETFs).
Retail investors, gradually returning to the cryptocurrency market after the January hiatus, are contributing to the growth of leading coins to their multi-year highs, writes Bloomberg, citing a report from JPMorgan.
The investment bank has noted the activity of retail traders' wallets, which move bitcoins much more often than institutional investors after the launch of Bitcoin ETFs.
Earlier, Bloomberg noted a 60% increase in commission revenue on the leading American cryptocurrency exchange Coinbase in the fourth quarter of 2023. The publication also reported a significant increase in trading volumes on the retail-oriented brokerage platform Robinhood, where cryptocurrency transaction volumes grew by 242% over the year.
According to JPMorgan analysts, three key events that will be in focus for retail traders in the coming months are the Bitcoin halving, the upcoming Ethereum DenCun update, and the expected approval of Ethereum ETFs in May. JPMorgan strategists believe that the first two growth drivers are already priced into the cryptocurrency market. They estimate the likelihood of approval for spot Ethereum ETFs at 50%.
Google search statistics for the term "bitcoin" indicate a significant spike in interest in the cryptocurrency market after the successful launch of spot exchange-traded funds (ETFs) on Bitcoin in January.
According to JPMorgan Chase's estimate, the February growth in retail investments is part of a larger trend. Data from payment services provider Block Inc., PayPal, as well as leading American broker Robinhood, indicate growing interest from retail investors in purchasing Bitcoin.
Reports from the largest American cryptocurrency exchange Coinbase showed the highest quarterly Bitcoin trading volume in two years.
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