Despite the volatility, Bitcoin (BTC) has still managed to rally by nearly 60% since January. However, the ride has not been smooth. After briefly touching $30k in April, the original crypto has once again fallen below the $27k mark. Nonetheless, analysts at JPMorgan believe that Bitcoin’s (BTC) price should be substantially higher.
JPMorgan strategists claim that given the price of gold, Bitcoin should be trading at a significant premium to where it is right now. The analysts believe this since many investors see Bitcoin (BTC) and gold through the same lens. The analysts claim that given the current price of gold, which is a little under $2,000 per ounce, BTC should be trading at about $45,000. At its current price of $26,512, Bitcoin is trading about 70% below where analysts believe it should be.
However, some people might not be persuaded by the claim that both act as value stores. Compared to gold, which has played that role for centuries, Bitcoin (BTC) has barely been around for 14 years.
Furthermore, JPMorgan analysts also pointed to Bitcoin’s (BTC) halving event as another reason for a potential price surge. The price of mining one Bitcoin would double to about $40,000 at the subsequent halving event, which is anticipated to occur in April or May of next year.
Nonetheless, JPMorgan analysts were not bullish on Bitcoin’s (BTC) short-term performance. The group pointed to the ongoing regulatory backlash against digital assets as one of the reasons.
With JPMorgan’s Bitcoin analysis, will institutions re-enter crypto?
Earlier this year, JPMorgan announced plans to open a crypto lab in Athens, Greece. The announcement was a testament to the growing popularity of digital assets. It also gave weight to institutional interest in crypto.
The bull run in 2021 was fueled not just by retail euphoria, but also by institutional interest. However, the crash of 2022 brought a lot of fear among financial giants. However, with the markets cooling off and inflation in the U.S. going down, it is possible that institutions will once again open themselves up to crypto. With that being said, JPMorgan has said that it is not bullish in the short term. Therefore, financial giants could make a comeback, but in due time.