Bitcoin & Crypto: “increased participation” of institutional investors according to JP Morgan

JP Morgan believes that the participation of institutional investors on the market cryptocurrency is "now important", but that the volatility remains today a "major obstacle to wider adoption".

In his report Outlook 2020, the American investment bank has returned to the blockchain and the crypto-currencies.

Blockchain, the future technology in payments

Although the blockchain has not yet emerged in a mainstream fashion, JPMorgan thinks she has now gone "beyond experimenting with payments."

According to the financial institution, blockchain solutions from Trade Finance, like Marco Polo or Komgo, offer "the most progressive efficiencies" in the banking industry compared to other use cases.

JP Morgan also sees long-term potential for the distributed register technology (DLT) to transform business models of banks providing both efficient and resilient information transfer and storage.

But legal and regulatory frameworks and technical challenges, such as cross-platform integration, can slow progress, ”she said.

Cryptocurrency market continues to mature

The New York bank believes that the cryptocurrency market as Bitcoin "Continues to mature" with the "increased participation" of institutional investors and the introduction of new products on regulated exchanges.

But the volatility remains a major obstacle to wider adoption. Cryptocurrencies continue to play an limited role in portfolio diversification, ”She adds.

Finally, for JP Morgan, who is working on his own stable cryptocurrency JPM Coin, the stablecoins have the potential to grow significantly in global transaction activity despite the challenges of today.

Bitcorner and other cryptocurrencies continue to exhibit extreme volatility compared to fiat currencies, which has led to attention for stablecoins to minimize price fluctuations, ”concludes the bank.