Stablecoins, Miners Outperform as $18B Gets Wiped Out From Crypto in June: JPMorgan

As an analyst with a background in traditional finance and a growing interest in the digital asset space, I find the recent developments in the crypto market intriguing, if not a bit disheartening. The 8% decline in the total cryptocurrency market cap to around $2.25 trillion in June was unexpected, given the positive momentum we saw in May.

In their recent research report released on Monday, JPMorgan noted that the combined value of all cryptocurrencies decreased by approximately 8% in June, reaching roughly $2.25 trillion. This decline largely erased the advancements made in May.

In June, the markets for Decentralized Finance (DeFi), Tokens, and Non-Fungible Tokens (NFTs) experienced a decrease in their total value, according to analyst Kenneth Worthington’s assessment.

As an analyst, I’d express it this way: Contrary to the upward trend in conventional markets, where the S&P 500 and Nasdaq recorded impressive gains of 4% and 6% respectively during the month, the CoinDesk 20 index experienced a significant decline, falling nearly 20%.

Despite the challenges facing the digital assets sector as a whole, stablecoins managed to shine in June. The market cap for these coins remained relatively stable to even slightly increased, according to the report. Tether (USDT) led this growth, contributing significantly to the overall appreciation of stablecoins.

Bitcoin mining companies, including Core Scientific (CORZ), distinguished themselves by experiencing a 19% expansion in market capitalization. This growth was fueled by the profitability of “artificial intelligence-related power use cases.” Notably, CORZ entered into a significant deal with CoreWeave, a cloud computing firm, for a 12-year contract supplying 200 megawatts (MW) to support AI infrastructure. This partnership instigated a sector revaluation and a flurry of mergers and acquisitions.

Based on the data, the bank observed a decrease of up to 18% in daily crypto trading volumes compared to the previous month. It seems that March 2024 marked the peak for the crypto market in this cycle, in terms of value and trading volume.

JPMorgan reported that inflows into bitcoin spot ETFs experienced their second most significant outflow since inception, totaling approximately $662 million in redemptions among the 10 U.S.-listed funds during the given period.