From a virtual digital bust to a haloed and ballyhooed bullion replacement.
That's what at least one influential Wall Street investment bank sees for Bitcoin, the cryptocurrency that has seemingly risen from the ashes to record highs over the past months and weeks amid a flurry of interest from large-scale investors.
In a research note to clients, analysts at JPMorgan Chase predict a long-term bitcoin price target of more than $146,000 based on the assumption that the cryptocurrency will grow in popularity as an alternative to gold, which has traditionally been used as an inflation and volatility hedge, as well as protection against a falling U.S. dollar.
“A crowding out of gold as an ‘alternative’ currency implies big upside for bitcoin over the long term,” wrote JPMorgan Chase strategists led by Nikolaos Panigirtzoglou. However, “a convergence in volatilities between bitcoin and gold is unlikely to happen quickly, and is in our mind a multiyear process.
“This implies that the above $146,000 theoretical bitcoin price target should be considered as a long-term target, and thus an unsustainable price target for this year,” they said.
The price of bitcoin breached a record high of $34,000 this past weekend, quadruple its value at the start of 2020, amid ongoing demand from institutional investors, who have pivoted to including the traditionally volatile security in their investment portfolios.
That compares to early 2019, when the digital currency slumped to $3441.03 from $13,062.15 in mid-2017. Bitcoin began trading in Oct. 2013 at a price of $196.02.
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