Your guide to Bitcoin, Ethereum and Web 3.0

by Arthur · February 9, 2023

More than half of institutional traders surveyed by global financial giant JP Morgan said artificial intelligence and machine learning will be the most influential technology to shape the future of trading over the next three years – cited four times more than blockchain and distributed ledger technology.

Now in its seventh year, JP Morgan’s e-trading editors report, the latest report drawn from a January survey of 835 institutional traders in 60 global markets. The annual assessment of traders’ sentiment spans multiple asset classes and is intended to reveal “upcoming trends and the most hotly debated topics.”

The tumultuous bear market in crypto – coupled with the recent consumer and commercial hype over available AI technology like ChatGPT – appears to have changed the outlook for financial industry professionals. Last year, blockchain and distributed ledger technology came in second with AI and machine learning, with 25 percent of respondents declaring them the key to the future. Mobile commerce applications came first, with 29 percent.

Now AI dwarfs all other major categories of technology, its 53% citation rate far ahead of API integration (14%) and blockchain (12%). The top 2022 technology, mobile apps, fell to 7%, along with quantum computing and natural language processing.

Tackling crypto specifically, JP Morgan found that 72% of traders “have no plans to trade crypto [or] digital coins,” with 14% predicting they plan to trade within five years.

Nevertheless, the respondents clearly felt that other players were positive about the place.

“Crypto and digital coins, commodities and credit are predicted to have the largest increase in electronic trading volume over the next year,” the report notes, with participants predicting that 64 percent of their activity will be in the crypto space by 2024.

While the survey found traders were unanimous in their belief that e-commerce will continue to grow, they also expected tough weather ahead. When asked which potential development will have the greatest impact on markets in 2023, the top responses were recession risk (30%), inflation (26%) and geopolitical conflict (19%).

The E-Trading Edit report is just the latest of several studies and reports that JP Morgan has released over the past month related to cryptocurrency and digital assets. Last week, the firm predicted “significant challenges” for Bitcoin and Ethereum, noting that Solana, Terra and tokens gained traction in the world of decentralized finance (DeFi) and non-fungible tokens (NFT).

JP Morgan also weighed in on the outlook for leading crypto exchange Coinbase last month, saying the upcoming Shanghai update for Ethereum “could usher in a new era of efforts” for the firm.