ChainCatcher reported that on Monday, the cryptocurrency market suffered its most dramatic correction since the FTX crisis, with Bitcoin prices falling by more than 15% before rebounding. JPMorgan analysts said the rebound was mainly due to institutional investors, who had limited or no de-risking of Bitcoin futures despite the overall market turmoil. JPMorgan analysts wrote in a report on Wednesday that JPMorgan's futures position indicator shows that these investors are optimistic about the outlook. They said that the higher premium of Bitcoin futures to spot prices shows that futures investors are confident.

Analysts believe there are many reasons for institutional investors to remain optimistic. Last week, Morgan Stanley allowed its wealth advisors to recommend spot Bitcoin exchange-traded funds to some clients. In addition, analysts said that the large-scale liquidations from the Mt.Gox and Genesis bankruptcies may be over, while cash payments from the FTX bankruptcy later this year may stimulate demand in the cryptocurrency market. In addition, they added that both major U.S. political parties have expressed support for favorable cryptocurrency regulation. However, analysts pointed out that these positive catalysts have been largely factored in by the market.

Analysts also pointed out that this round of Bitcoin's sharp decline was not caused by cryptocurrency-specific problems, but by the pullback of traditional risk assets such as stocks. While institutional investors helped support Bitcoin's rebound, retail investors also contributed to its decline. In addition, momentum traders such as commodity trading advisors also played a role, exiting long positions and establishing short positions. Overall, despite the recent adjustments, JPMorgan analysts remain cautious about the cryptocurrency market. Given that the above positive catalysts are largely factored in and there is limited risk reduction in the CME Bitcoin futures space, coupled with the continued fragility of the stock market, analysts recommend maintaining a cautious outlook.