JP Morgan, known for its financial foresight, has made a daring prediction in the crypto realm, asserting that Ethereum (ETH) will surpass Bitcoin (BTC) in 2024. This surprising forecast comes in the midst of the industry’s cautious outlook for the upcoming year and despite Bitcoin’s imminent halving event, which traditionally impacts its circulation.

JP Morgan’s analysts attribute their prediction to the “excessive optimism” surrounding Bitcoin in the coming year. They emphasize that the anticipation of the halving event is already deeply ingrained in the asset’s current valuation, dampening expectations for a substantial surge in its value.

Bitcoin’s struggle for mainstream acceptance throughout 2022 and early 2023 is acknowledged by JP Morgan. The crypto market faced a prolonged winter, raising doubts about its recovery. As 2024 approaches, however, excitement surrounding Bitcoin is reaching new heights, fueled by expectations of the approval of the Spot Bitcoin ETF and the looming halving event.

Despite the positive sentiment, JP Morgan’s cautious forecast for the industry hints at potential challenges. They caution against overexcitement, emphasizing how this could lead to an overbought market, especially with the halving event already factored into Bitcoin’s value.

The bank’s analysis delves into the potential impact of the halving event on Bitcoin miners, anticipating a doubling of production costs and a 20% decline in hash rates. Such shifts could prompt over-costed miners to exit the market. On the contrary, JP Morgan highlights Ethereum’s EIP-4844 “Proto-dank sharding” update, acknowledging its potential to influence Ethereum’s performance in the coming year.

While expressing concerns about centralized mining on the Ethereum network, JP Morgan’s divergence from the bullish Bitcoin narrative suggests that the leading cryptocurrency might face challenges in meeting the heightened expectations. As the crypto community eagerly anticipates 2024, these contrasting perspectives add an intriguing layer to the unfolding narrative.

Source: Watcher Guru