Bitcoin Could Be Worth $126,000, Says JPMorgan
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JPMorgan analysts believe that Bitcoin is currently undervalued compared to gold. They argue that the cryptocurrency’s price should be much higher, around $126,000, especially as its volatility has dropped to record lows.
At the beginning of the year, Bitcoin’s volatility was near 60%, but it has now fallen to about 30%. This makes it less risky than before, and analysts expect the price could reach fair value by the end of the year.
Corporate Treasury Purchases Supporting Bitcoin
As it stands, the increase in corporate treasury purchases can be seen as one of the key reasons for this change in Bitcoin. Companies now hold more than 6% of Bitcoin’s total supply, which has helped reduce market swings. JPMorgan compared this effect to central banks’ quantitative easing after the 2008 crisis, where assets were locked into long-term holdings to stabilize markets.
The trend is growing stronger as more companies compete to use Bitcoin as a reserve asset. In recent times, Nasdaq-listed KindlyMD has announced its application to raise up to $5 billion to buy Bitcoin. Also, Adam Back’s BSTR is aiming to become the second-largest corporate holder after MicroStrategy.
To this end, this corporate competition is making Bitcoin more stable and attractive to investors.
Index Addition and Broader Market Impact
Another factor boosting Bitcoin is its inclusion in global equity indices. For example, MicroStrategy’s entry into major benchmarks has brought new inflows, while Metaplanet’s promotion to mid-cap status in FTSE Russell indices led to its addition to the FTSE All-World Index. These moves are drawing more passive investment into Bitcoin.
At the same time, Bitcoin’s volatility compared to gold has dropped sharply. The ratio now stands at 2.0, its lowest ever. This means Bitcoin is becoming easier for institutions to add to their portfolios. Analysts estimate that Bitcoin’s market value needs to rise by 13% to match gold investments, which points to a price of around $126,000.
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