JPMorgan Chase reiterated in a recent report that the price of Bitcoin is expected to reach $146,000 in the long term. The premise is that the volatility subsides substantially. Financial institutions began to prefer Bitcoin over gold in their investment portfolios. This target price is about 130% higher than Bitcoin’s current price of less than $62,500.
JPMorgan Chase believes that Bitcoin is used as a hedge against inflation. It increasingly competes with gold for the attention of investors. Bitcoin is a scarce product, and even if inflation erodes the value of other assets, these assets will rise.
Nikolaos Panigirtzoglou, strategist at JPMorgan Chase, said:
“From September to October 2021, investor concerns about inflation reappeared. There seems to be a renewed interest in using Bitcoin to hedge against inflation.”
“In recent weeks, gold has failed to respond to rising inflation concerns. This may enhance the attractiveness of Bitcoin as an inflation hedge.” Inflation in the United States is currently at a 13-year high. Global inflation is also soaring.
Panigirtzoglou said that as more young people become stronger in the investment field, the competition between Bitcoin and gold will continue. This is “no doubt”.
“Considering the scale of financial investment in gold. Any outflow from gold to’alternative’ currencies means that Bitcoin has a lot of room for long-term upside.”
He hinted that the long-term price target for Bitcoin is $146,000
However, JPMorgan Chase stated that to achieve a price of $146,000, Bitcoin’s huge volatility must be significantly reduced. In this way, investors who are bound by the rules can safely add Bitcoin to their investment portfolios.
JPMorgan Chase pointed out that Bitcoin’s volatility is currently about four to five times that of gold. Before the influx of institutional investors, its volatility must drop significantly.
JPMorgan Chase has issued a major warning about its “theoretical” target price. Said that Bitcoin’s volatility is a major obstacle to continued price increases. The bank said that during the ups and downs of April and May, Bitcoin’s reputation among institutional investors took a hit.
In fact, JP Morgan Chase believed at the time that Bitcoin was so volatile that its fair price should actually be around $35,000. However, the bank now says that Bitcoin’s volatility is declining, and the price of $73,000 next year looks reasonable.