JPMorgan issued Stark Ethereum NFT warning after huge Solana and Cardano surge hits Bitcoin

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Bitcoin, ethereum and cryptocurrency prices are struggling after a terrible start to 2022 (even as the non-fungible token (NFT) craze continues).

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The price of bitcoin has lost 40% of its value since its peak in November, while Ethereum and its biggest rivals solana and cardano have better held onto earlier gains, reducing bitcoin’s dominance in the combined crypto market. Today, bitcoin represents just 40% of the $2 trillion crypto market, up from over 60% 12 months ago.

Now, Wall Street giant JPMorgan JPM has warned that Ethereum’s high transaction fees and network congestion risk giving NFT market share to its blockchain competitor Solana, which could be a “problem for Ethereum Valuation”.

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MORE FROM FORBESCrypto Price Prediction: ‘Valuation Models’ Reveal Bitcoin 2022 TargetBy Billy Bambrough

JPMorgan analysts have warned that Ethereum price could take a hit as market share is gained by the likes of… [+] solana and cardano, both of which have skyrocketed over the past year, toppling bitcoin’s dominance.

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“It looks, similar to DeFi [decentralized finance] applications, congestion and high gas fees have prompted NFT applications to use other blockchains,” the JPMorgan analysts, led by Nikolaos Panigirtzoglou, wrote in a note to clients last week, reported for the first time by Business Insider. Ethereum transaction fees have skyrocketed. in recent months, with the network buckling due to the volume of users.

Ethereum’s NFT market share grew from around 80% to around 95% at the start of last year, the JPMorgan team wrote in the note released last week. “If the loss of its NFT share starts to look more sustained in 2022, it would become a bigger issue for Ethereum’s valuation,” they said, adding that NFTs are currently “the fastest growing universe.” rapidity of the crypto ecosystem”.

JPMorgan analysts have found that since August, Ethereum rival Solana, whose price has risen 3,600% in the past 12 months, has been gaining NFT market share from Ethereum. Solana is touted as a faster and cheaper alternative to Ethereum, but critics have said its network is too centralized and has suffered several outages in recent months.

The price of ethereum, meanwhile, has increased by 2,000% over the past two years, compared to bitcoin’s 400% increase over the same period. Investors have crowded into Ethereum over the past two years as interest in Ethereum-based DeFi – using cryptographic technology to recreate traditional financial services – and digital media NFTs has exploded.

Earlier in the month, JPMorgan also warned that Ethereum was in danger of losing its DeFi dominance due to its inability to upgrade and scale its network as quickly as rivals such as Solana and Cardano. Ethereum recently began a long-awaited upgrade that should be completed this year, but there are concerns that it may not come soon enough to keep Ethereum competitive.

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MORE FROM FORBES “Amazing” – An Investment Giant Just Advised Countries And Central Banks To Buy Bitcoin While The Price Is LowBy Billy Bambrough

The price of ethereum has moved with the price of bitcoin over the past year but remains more than… [+] doubling where it started in 2021, even as Ethereum’s market share is eroded by Solana and Cardano.

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The NFT market has soared to around $12 billion over the past year, with the craze sent into the stratosphere by the sale of an NFT, a collection by digital artist Beeple, for $69 million in March 2021.

The OpenSea NFT Market has generated approximately $2.7 billion in volume so far this year, primarily fueled by a surge in prices for the hugely popular Bored Ape Yacht Club NFT Collection, and is on track to surpass the 3 .4 billion reached in August, according to data from Dune Analytics.

Over the past week, the price of bitcoin and ethereum have continued their downward trend, with declines hitting the likes of solana and cardano.

“The market has remained largely constrained over the past week as bitcoin and ethereum continue to trade towards the September 2021 lows of $40,000 and $3,000 respectively,” Will said via email. Hamilton, head of trading and research at Trovio Capital Management.

“Investors and traders seem to be digesting the macro possibilities in this new inflationary regime markets have entered, alongside an increasingly hawkish Federal Reserve.”

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