Comments from JP Morgan on the "-40% drawdown in Cryptocurrencies"

  • the third in four years
  • but this time, it occurred in a $2trn asset class.

Despite the size of the sector JPM go on (bolding is mine):

  • cross-asset consequences have been mild
  • with less Equity/Credit drawdown than occurred during January's meme-stock frenzy or February's sell-off in Bonds
  • As large and bubble-like as Crypto had become based on valuations, momentum and investor leverage, it's not yet in the same category as the Nikkei (1980s), dot-com stocks (1990s) or sub-prime (2000s) in terms of household/corporate leverage and financial sector infestation.
  • Huge wealth losses are always possible, but not necessarily systemic.

Meanwhile, BTC is recovering some of its losses over the weekend, off is lows as I post:

Comments from JP Morgan on the -40% drawdown in Cryptocurrencies