A JPMorgan analyst is issuing a warning following a cryptocurrency market rally that propelled a long list of altcoins to new record highs.
JPMorgan managing director Nikolaos Panigirtzoglou says in a new note to clients that cryptocurrency markets are looking “frothy again,” reports Forbes.
[adinserter block="1"]“The August rally in non-fungible tokens and the pickup in decentralized finance activity have helped not only Ethereum but also alternative cryptocurrencies that facilitate or plan to facilitate smart contracts, such as Solana, Binance Coin and Cardano.
The previous phase of retail investors’ mania into cryptocurrency markets was between the beginning of January and mid-May… and retail investors are making cryptocurrency markets look frothy again.”
According to CoinGecko, Cardano (ADA) hit an all-time high of $3.09 on September 2nd. Solana also reached its own record high of $193.87 on Tuesday.
In the same note, Panigirtzoglou says the combined market share of Bitcoin (BTC) and Ethereum’s (ETH) has dropped 78% to 67% as he says institutional investors lose interest in funds that track the two leading crypto assets.
Panigirtzoglou says that Bitcoin’s market share has fallen to “uncomfortably low” levels, which indicates retail investor mania as opposed to steady growth.
At the time of writing, the ratio of Bitcoin’s market cap relative to the rest of the crypto markets is 40.6% while Ethereum’s dominance is 18.6%, according to CoinGecko.
Less than two months ago, JPMorgan reportedly began allowing its wealth management clients to invest in various crypto funds including the Grayscale Bitcoin Trust, Bitcoin Cash Trust, Ethereum Trust, Ethereum Classic products, and Osprey Funds’ Bitcoin Trust.
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