Bitcoin might have the potential for significant further gains over the long term as it competes with gold for financial investment flows, according to JPMorgan Chase & Co.
Bitcoin’s market capitalization of around $575 billion would have to climb by 4.6 times, for a theoretical Bitcoin cost of $146,000 to match the complete private sector investment in gold via exchange-traded funds or bars and also coins, strategists led by Nikolaos Panigirtzoglou wrote in a note. But that expectation depends on the volatility of Bitcoin assembling with that said of gold to urge more institutional investment, a procedure that will take some time, they said.
A crowding out of gold as an ‘alternate’ currency implies big upside for Bitcoin over the long-term,” the strategists created Monday. Nonetheless, “a convergence in volatilities between Bitcoin and gold is unlikely to happen quickly and also remains in our mind a multiyear process. This indicates that the above-$ 146,000 academic Bitcoin cost target must be considered as a lasting target, as well as therefore an unsustainable rate target for this year.