The recent downtrend in the cryptocurrency market appears to be coming to an end, with new research from JPMorgan Chase showing that most long positions have been liquidated.

according to According to a Bloomberg report, analysts at the U.S. bank estimated that the liquidation is “largely over.” The forecast, based on open interest in Chicago Mercantile Exchange (CME) bitcoin (BTC) futures contracts, suggests that the selling trend may soon slow down. Open interest refers to active futures contracts and is an indicator of market sentiment and the strength of price trends.

Analysts said the drop in Bitcoin open interest was seen as a sign that the current price trend may be weakening. “As such, we see limited near-term downside in the cryptocurrency market.”

CME BTC futures open interest. Source: CoinGlass

The report noted that cryptocurrency prices have been trending lower in recent weeks as optimism over U.S. regulatory developments wanes. On Aug. 26, bitcoin traded near $26,000, down 11.27 percent over the past 30 days, according to Cointelegraph Markets.

Positive developments in previous months have boosted the price of Bitcoin. These include a series of applications for U.S. exchange-traded funds (ETFs) tied to the spot price of bitcoin. The list of participants awaiting regulatory approval includes BlackRock, Fidelity, ARK Investments and 21Shares, among several other asset managers.

Ripple Labs’ partial victory over the U.S. Securities and Exchange Commission (SEC) is another positive development. However, the analysis pointed out that this optimism is fading as traders wait for the decision of the Bitcoin ETF and the SEC’s appeal against Ripple to bring new uncertainties.

The JPMorgan team said the situation has led to a “new round of legal uncertainty” in cryptocurrency markets, making them sensitive to future developments. External market conditions also played a role in the cryptocurrency market’s decline, including rising U.S. real yields and concerns about China’s economic growth.

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