2023-05-27 10:38:00
© Archyde.com. JPMorgan: Bitcoin could reach $45K due to the rise in gold prices
The current price of gold, which is approximately 2,000 an ounce, means that the price is $45,000. According to JPMorgan analysts, assets tend to move in tandem and are viewed by investors as alternatives.
The strategists at JPMorgan (NYSE) wrote: “With a rally above $2,000. The value of gold held for investment purposes outside central banks is currently estimated at approx [3 تريليون دولار]. This, in turn, means a bitcoin price of $45,000 assuming bitcoin is equivalent to gold for private investors.”
JPMorgan considers the $45,000 Bitcoin price to be the upper limit. This indicates the limited potential of the asset beyond the increase driven by the doubling of mining or production costs. According to JPMorgan, the next Bitcoin halving event in April or May 2024 will double the cost of producing Bitcoin to about $40,000. “This is because the cost of producing bitcoin has historically served as an effective floor,” said strategists at JP Morgan (EGX:) Morgan. “In fact, the previous halving events of 2016 and 2020 were accompanied by an upward trajectory in bitcoin prices that accelerated after the halving event.”
Bitcoin halving is an event that occurs approximately every four years. This reduces the reward for mining new Bitcoin blocks by half. Which effectively reduces the rate of creation of new bitcoins. In order to control inflation and keep Bitcoin scarce over time. The upcoming Bitcoin halving will see the block reward halving from 6.25 BTC to 3.125 BTC.
JPMorgan assumes a 25% return on bitcoin over the next 12 months, as this time frame captures the expected halving event in 2024.
JPMorgan on ETH Ether (ETH) may continue to experience some near-term selling pressure after the Shanghai upgrade until the middle of the year or so, according to JPMorgan. “So we expect it to underperform Bitcoin somewhat in the near term,” the bank said.
Overall, JPMorgan maintains its cautious stance on digital assets as headwinds are likely to limit the US regulatory crackdown. And disruptions to cryptocurrency banking networks, and the ongoing fallout from the collapse of the FTX trading platform, limited any potential gains.
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