Wall Street bank JPMorgan Chase said cryptocurrency trading volumes fell sharply last month amid a broad market pullback.
The bank said stablecoin trading volume has slowed sharply, with average daily trading volume falling 26% month-on-month, and decentralized finance (DeFi) and non-fungible token (NFT) trading volumes have also weakened significantly.
Analysts led by Kenneth Worthington said in a report on Tuesday that concerns about system leverage, talk of a possible new cryptocurrency winter and underperformance relative to stocks have weighed on valuations and activity, casting a shadow over a handful of M&A deals and product launches.
Flows into U.S.-listed crypto products also turned negative, analysts wrote. U.S. Bitcoin spot exchange-traded funds (ETFs) saw net outflows of $3.4 billion in November, erasing October’s net inflows.
The report noted that U.S. ethereum exchange-traded products had their worst month on record, with net redemptions of $1.4 billion.
Trading activity also deteriorated. JPMorgan Chase said that according to CoinDesk data, overall spot trading volume fell by 19% month-on-month in November, and TradingView also showed a similar decline of about 23%.
Bitcoin’s Market value fell 17% to $1.8 trillion, still outperforming Ethereum Its market value fell 22% to $361 billion, analysts wrote.
Cryptocurrencies have significantly underperformed traditional equity benchmarks, with the S&P 500 flat last month and the Nasdaq 100 down about 2%.
The total cryptocurrency market capitalization fell 17% to $3.04 trillion, while the value of public stocks related to cryptocurrencies fell 21%.
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