JPMorgan Chase & Co. sees Bitcoin as a future competitor of gold as an asset class, with the long-term potential to reach $146,000, Bloomberg reports.
Why It Matters: It would be quite the climb for Bitcoin, which rallied to a record $34,000 before retreating a bit on Monday. But it’s a long way off, if anything. Private investment in Bitcoin would have to grow at a multiple of nearly five to match the investment in gold via ETFs or bars and coins.
But a healthy future for Bitcoin depends on its volatility coming down to gold’s level, encouraging more institutional investment.
- A group of strategists led by Nikolaos Panigirtzoglou said this could be a “multiyear process.”
Key Numbers (From CoinMarketCap):
- Bitcoin’s Market Capitalization: $592 Billion
- Bitcoin’s Circulating Supply: 18,600,000 Tokens
- Bitcoin’s Current Price (9:00 a.m. ET): $31,701.10
As prices continue to improve and volatility appears to stabilize, more institutions and noted investors are getting involved or expressing interest. But a heated debate over Bitcoin remains:
- “While some argue that the cryptocurrency offers a hedge against dollar weakness and inflation risk in a world awash with fiscal and monetary stimulus, others say retail investors and trend-following quant funds are pumping up an unsustainable bubble.”
The Future, For Now: JPMorgan anticipates headwinds for the digital currency, with indicators “like a buildup of speculative long positions and an increase in investment wallets holding small amounts of Bitcoin showing potential froth.”