(Bloomberg) — The current phase of deleveraging in cryptocurrencies is at an advanced state and may not last much longer, according to JPMorgan Chase & Co.

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Multiple crypto company failures shouldn’t be surprising given huge price declines among tokens, and entities that used higher leverage in the past are the most vulnerable, strategists including Nikolaos Panigirtzoglou wrote in a note Wednesday. The liquidity crunch at hedge fund Three Arrows Capital “is a manifestation of this deleveraging process,” they said.

“The current deleveraging cycle may not be very protracted,” the strategists said, given “the fact that crypto entities with the stronger balance sheets are currently stepping in to help contain contagion” and that venture-capital funding, “an important source of capital for the crypto ecosystem, continued at a healthy pace in May and June.”

The crypto space has endured a number of high-profile blowups and hiccups in recent months. Total market cap was down to around $930 billion on Thursday, according to pricing from CoinGecko, after having surpassed $3 trillion in November. The collapse of the Terra/Luna ecosystem in May, the Three Arrows Capital failure and frozen withdrawals at lenders like Celsius Network are among the signs of woe cascading through the industry.

Read more: Crypto Hedge Fund Three Arrows Set for Liquidation

But crypto exchange FTX, for instance, has been granting lines of credit to some firms and is reportedly even looking at acquisitions. Fund raising efforts from venture capital have continued, like data firm Kaiko’s $53 million haul this week.

A good portion of the troubles may be behind crypto now, according to JPMorgan. Indicators like the firm’s net leverage metric “suggest that deleveraging is already well advanced,” the strategists said.

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