PMorgan's comprehensive survey involving over 4,000 institutional traders has shed light on the current sentiment towards cryptocurrency trading, indicating a cautious approach by the majority. The survey uncovers traders' perspectives on future technologies and market catalysts affecting the trading landscape.
Lukewarm Response to Cryptocurrency
The survey results reveal a significant disinterest in cryptocurrency trading among institutional traders, with 78% stating they have no plans to engage in crypto trading within the next five years. Only a small fraction, 12%, expressed intentions to explore cryptocurrency trading in the foreseeable future.
Blockchain's Declining Influence
Interest in blockchain as a transformative technology for trading has seen a sharp decline. From being considered an influential technology by 25% of participants in 2022, it plummeted to just 7% in 2024. This marks a notable shift in traders' perceptions towards blockchain and distributed ledger technology (DLT).
Rising Faith in AI and Machine Learning
Contrary to blockchain, AI and machine learning are gaining momentum, with 61% of the surveyed traders highlighting these technologies as key influencers in shaping the future of trading. This represents an increase from the previous year, emphasizing a growing consensus on the potential of AI and machine learning in revolutionizing trading practices.
Crypto Trading Activity: A Slight Uptick
Despite the overall skepticism towards crypto, the survey noted a marginal increase in active institutional crypto traders, rising to 9% from 8% in 2023. This uptick suggests a slow but growing interest in digital currency trading, possibly fueled by the entry of financial giants and the approval of spot bitcoin ETFs in the U.S.
JPMorgan's Stance on Crypto
Although JPMorgan has engaged in the digital assets sector, its CEO, Jamie Dimon, has been openly critical of cryptocurrencies, likening bitcoin to a "pet rock" and advising against involvement in crypto.
Macro Events Shaping the Market
Traders identified inflation, the upcoming U.S. election, and recession risk as the primary factors expected to influence the broader market in the coming year, highlighting the complex interplay of macroeconomic variables in trading decisions.
Institutional Traders Remain Cautious on Crypto
JPMorgan's survey paints a clear picture of institutional traders' current stance on cryptocurrency: a cautious approach with a stronger inclination towards AI and machine learning as the future of trading. While blockchain's influence wanes, the growing interest in AI technologies and a slight increase in crypto trading activity suggest a nuanced view of the evolving trading landscape.
