JP Morgan’s recent eTrading survey revealed that only 29% of institutional traders plan to trade cryptocurrencies, a decrease from 22% last year. The survey, which involved over 4,200 traders, saw an increase in active traders to 13%, likely linked to the launch of U.S. Bitcoin ETFs and a significant rise in Bitcoin prices in 2024. While artificial intelligence remains the leading technology for traders, blockchain usage has dropped slightly. Although tokenization is expected to generate interest in blockchain, its impact is currently felt more in back-office operations than in trading. Initiatives like 21X’s regulated digital securities exchange may change this landscape, but such outcomes are still rare today.
In a recent survey by JP Morgan, which involved over 4,200 institutional traders, the interest in cryptocurrency trading showed some interesting shifts. While 71% of respondents stated they had no plans to trade cryptocurrencies, this figure has decreased from 78% last year. Active traders in this space have now risen to 13%, a notable increase from 9% reported in 2024.
This uptick in active traders aligns with the launch of Bitcoin ETFs in the U.S. in January 2024 and a significant rise in crypto prices, particularly Bitcoin, which surged over 120% during the year. In contrast, 2023 was largely defined by recovery efforts following the FTX collapse.
The survey also explored the significance of various technologies in trading. Artificial intelligence emerged as the leading technology, followed by APIs. Blockchain technology holds a distant third place, with only 6% of traders considering it essential, a slight decline from the previous year.
Interestingly, while tokenization is expected to increase interest in blockchain technology, it primarily influences back-office operations rather than trading practices. Most tokenized bonds are still traded in traditional ways, even if they are ultimately settled on a blockchain. Larger digital security platforms have begun integrating blockchain systems with existing legacy systems. This means traders might not even realize they are engaging with digital bonds.
Looking ahead, the adoption of permissionless blockchains could alter this landscape. In Europe, for instance, 21X is set to launch a regulated digital securities exchange featuring an on-chain order book. However, such practices remain exceptions in the digital securities Market today.
This survey underscores a gradual evolution in the cryptocurrency Market, highlighting both increased trader engagement and the need for technological advancements in trading practices.
Tags: JP Morgan, cryptocurrency trading, Bitcoin ETFs, institutional traders, blockchain technology, tokenization technology.
What does the JP Morgan survey say about institutional traders and crypto plans?
The JP Morgan survey shows that 71% of institutional traders currently have no plans to invest in cryptocurrencies. This suggests that many institutions are cautious or uninterested in entering the crypto space.
Why are most institutional traders not planning to invest in crypto?
Many institutional traders may avoid crypto due to concerns about regulation, volatility, and security issues. They might also prioritize more traditional and stable investments.
Are there any institutions that are investing in cryptocurrencies?
Yes, some institutional investors are exploring or investing in cryptocurrencies. However, the majority still prefer to stick with traditional assets for now.
What might change the mind of institutional traders about crypto?
Greater regulation, improved security, and a more stable Market could make cryptocurrencies more appealing to institutional traders. If these factors change, we might see more interest.
Will crypto plans change in the future for institutional traders?
It is possible that institutional traders may reconsider their stance on cryptocurrencies in the future. As the Market matures and more information becomes available, they might see new opportunities.
