According to JPMorgan, the FTX scandal might cause a 25% drop in the price of bitcoin.

The bankruptcy of the trading company Alameda Research and the cryptocurrency exchange FTX had a negative impact on the price of Bitcoin (BTC), and the authorities issued a stern warning as a result.

In comparison to its all-time high of $69,000 last year, the price of BTC has fallen below $17,000. Numerous parties believe that the already low cryptocurrency price may continue to fall.

Future Price of Bitcoin Because of the FTX Scandal, JPMorgan analysts under Nikolaos Panigirtzoglou predicted that the price of Bitcoin will drop by 25% as a result of the FTX failure. JPMorgan has also made significant investments in the cryptocurrency sector.

According to JPMorgan analysts quoted by Forbes, "what made the crypto collapse caused by FTX and Alameda Research more problematic was that the number of entities with strong balance sheets that were able to bail out indebted entities within the crypto ecosystem was decreasing."

The price of BTC could reach US$13K while Bitcoin production is US$15K because to the crypto crisis brought on by a string of significant Terra ecosystem (LUNA) failures, according to analysts.

According to JPMorgan, a series of additional margin calls will cause a number of cryptocurrency companies to go bankrupt. This prediction was based on the size and connections between FTX and Alameda Research and other organizations in the crypto ecosystem, such as DeFi platforms.

This is a recurrence of the crypto market crisis in May of last year, which was brought on by LUNA and Terra USD (UST), a stablecoin that was supposed to be pegged to the USD but didn't manage to peg.

After combining customer funds with Alameda Research's trading balances, FTX was discovered to have a significant US$10 billion imbalance in its balance sheet this week.

The most recent bankruptcy filing by FTX listed over 100,000 creditors and a total debt of between $10 and $50 billion USD.

JPMorgan analysts believe that the FTX issue may result in a wave of debt defaults similar to the one that followed LUNA's failure last May. Only by saving FTX and Alameda Research is this avoidable.
The cryptocurrency industry did not, however, anticipate a speedy resolution to FTX's insolvency.

Anto Paroian, CEO of hedge fund ARK36, said that it would be weeks before the entire extent of the devastation was apparent.

Despite the panic that the cryptocurrency market is currently facing, a number of sources point out that market strengthening may come soon.

While the cryptocurrency market is down, Akeel Qureshi, Hubble Protocol and Kamino Finance contributor at Solana, noted that volatility in the market frequently causes shocks that ultimately boost the sector over time.