Analysts at JPMorgan have projected that the price of Bitcoin will decline to $25,000 level and further sell-offs is expected before eventual capitulation.
In an investor note released by the firm, the analysts said that the cryptocurrency market appears to be healing.
They explained that the near-term outlook for the crypto market is “challenging,” noting that blockchain data suggests recent cryptocurrency sell-offs were made to cover losses.
“There is likely still an overhang of underwater positions which need to be cleared through the market,” they said.
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“Cryptocurrency market shows signs that it is not yet healthy, [but] it does also appear to be beginning the process of healing.”
The analysts also warned of the possibility of increased production costs of BTC as China’s crackdown pushes bitcoin mining abroad, but they also recognized the stability in the bitcoin futures market as a positive factor.
Last month, the Chinese government banned financial firms and payment institutions from offering services related to cryptocurrency transactions. It also prohibited crypto exchanges and initial coin offerings (IOCs).
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The United Kingdom’s Financial Conduct Authority (FCA) has also placed a ban on Binance — the world’s largest cryptocurrency exchange by trading volume — from operating in the country.
Bitcoin price stood at $35,028.75 at 8:57 am on Wednesday, according to CoinMarket.
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