JPMorgan considers the economic benefits of Ethereum 2.0, which thanks to its Proof of Stake profit model can boost the crypto economy.
JPMorgan analysts see great potential in the Ethereum 2.0 network. Recently, two analysts from the prestigious American bank, which is one of the oldest investment companies in the world, pointed out in a report that the profit model presented by Ethereum 2.0 with the staking de cryptocurrencies, could boost mainstream adoption of the industry by providing users and investors with an innovative new mechanism to generate revenue quickly, in a much more planet-efficient way.
“As staking becomes more common, we believe it could boost interest and market cap in cryptocurrencies.”.
According to the report, called “Introduction to Staking: The Rapidly Growing Opportunity for Cryptocurrency Brokers and Their Clients”, quoted by the magazine Forbes, the way networks work block chains of participation tests or proof of stake (PoS) will drive mass adoption of cryptocurrencies in the future.
The bank's analysts point out that the staking, or the practice of depositing and locking value within a PoS blockchain, is set to intensify by 2025. Currently, the staking generates some $9.000 billion in annual revenue; a figure that could increase to $40.000 billion in the next 4 years, with the arrival of Ethereum 2.0 to the ecosystem.
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Ethereum 2.0, a fast-growing opportunity
JPMorgan analysts believe that the official arrival of Ethereum 2.0 will stimulate staking as an investment mechanism to obtain a fairly significant nominal and real return. In the report, the entity pointed out that blockchains such as Solana pay returns of up to 10% per year to their investors, who, in addition to staking value to obtain profits, also play an important role within the network: validating and confirming transactions.
El staking, in addition, it helps blockchain networks reduce their energy expenditure, one of the hottest and most discussed topics in the world today. Regulators in China and Iran have implemented crackdowns on cryptocurrency miners on blockchain networks. Proof of WorkPoW)as the Bitcoin (BTC) y Ethereum (ETH), due to the high energy consumption they require for their operation. For this reason, networks such as Cardano, Polkadot, Solana, Cosmos y Ethereum 2.0, will be the future of the cryptoeconomy, JPMorgan analysts said.
Cryptocurrency intermediaries, i.e. companies and platforms that offer products and services related to crypto assets, providing access to PoS networks where retail investors can stake value, will be the biggest beneficiaries of staking. As the authors of the report indicate, staking will become one of the main sources of income for cryptocurrency intermediaries.
JPMorgan more open to the potential of cryptocurrencies
The US bank, which has long been skeptical of cryptocurrencies and digital assets, began exploring the crypto world in 2018 and has become more open to these assets in recent months. JPMorgan even has a division dedicated to analyzing and researching blockchain networks, to delve deeper into their benefits and use cases.
The company also opened a hiring process for developers of Ethereum and other networks such as Hyperledger and Corda, and in March it filed a document with the United States Securities and Exchange Commission (SEC) to request authorization from the regulator to create a “basket” or stock basket based on cryptocurrency companies; a product that will allow it to meet the growing demands and needs of its clients and investors who want to gain exposure to digital assets.
JPMorgan is one of the oldest financial institutions in the world, with more than 100 years of experience and a track record in Commercial Banking, Investment Banking, International Corporate Banking, Private Banking, and much more.
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