Bitcoin market update: JPMorgan’s economist explained what holds Bitcoin back

Bitcoin is in decline mode once again. The first digital coin is trading at $3,360, mostly unchanged in recent 24 hours. BTC/USD has come dangerously close to the critical short-term support zone. Once it is cleared, the downside main gain traction with the next focus on $3,200-$3,000.

As Bitcoin’s price moved away from overhyped levels, institutional players began changing their views on the industry.

According to Nikolaos Panigirtzoglou, Global Market Strategist at JPMorgan, the cryptocurrency market will see big players returning to the industry. Now that the volatility subsided, institutional investors feel more confident and ready to give Bitcoin a second chance.

“The stability that we are seeing right now in the cryptocurrency market is setting the stage for more participation by institutional investors in the future. The cryptocurrency market was a new market. It went through a bubble phase [and] the burst,” he said.

Speaking in the interview with CNBC, the expert explained that cryptocurrency growth is capped due to the absence of regulatory oversight. Though, the situation is likely to change within the upcoming years.

While Mr. Panigirtzoglou is not overly optimistic, his view implies a renewed interest in cryptocurrencies, which may translate into positive price momentum.

Earlier, Litecoin's creator Charlie Lee said that Bitcoin would return to $20,000 within three years.

BTC/USD, the daily chart