US regulatory crackdown sees institutional investors prefer gold over BTC: JPMorgan

[ad_1]

The U.S. regulatory crackdown is pushing U.S. crypto firms to seek opportunities overseas, JPMorgan (JPM) said in a research report on Thursday.

The US arm of Binance has canceled its deal with Voyager, while Coinbase has launched Coinbase International, a crypto derivatives exchange outside the US, as a proactive measure in response to growing regulatory pressures in the US, wrote analysts led by Nikolaos Panigirtzoglou.

The crackdown has increased pressure on crypto firms, JPMorgan said, but more importantly, there is still no clarity on important issues such as the status of ethers (ETH) as security, which will ultimately impact the demand and liquidity of cryptocurrencies.

The regulatory crackdown has also deterred institutional investors from engaging in crypto, and because of this, investors have been buying gold rather than bitcoin (BTC) as a hedge against a potential doomsday scenario in the wake of the pandemic. collapse of Silicon Valley Bank, according to the memo. .

Bitcoin’s rally this year appears to have been driven by retail buying rather than institutional investors, the bank said. The largest cryptocurrency has gained 76% since the start of the year.

Another catalyst for bitcoin’s outperformance has been bitcoin ordinals, the report adds. Ordinals is a new protocol that allows non-fungible tokens (NFTs) to be stored on the Bitcoin blockchain.

[ad_2]