While Bitcoin is still struggling in an unsuccessful attempt since mid-February to surpass the $ 60,000 levels.
The largest US bank is still determined to see that Bitcoin will surpass the levels of $ 100,000 and possibly reach $ 130,000 to $ 146,000.
It is noteworthy that banks Morgan Stanley (NYSE: MS) and Golden Man Sachs announced their intention to invest in Bitcoin and make exposure to cryptocurrencies available to major investors.
The Bitcoin currency, the largest cryptocurrency by market value, is trading at $ 1.09 trillion, at levels of $ 58,000, with a decrease of about 2.5% during those moments.
While Bitcoin succeeded in recording limited weekly gains that did not exceed 4%, while the largest currency increased by about 25% during last month’s transactions.
Once again, GBMorgan reiterated the target of the cryptocurrency Bitcoin at levels of $ 130,000.
JPMorgan sees a decrease in cryptocurrency volatility, as institutions and major investors continue to pour into the digital currency.
According to the analysis, experienced investors have the potential to increase exposure to Bitcoin, and the price will be less volatile.
JP Morgan says, in the long term, it may reach $ 130,000 per coin, if the currency reaches the value of the gold market.
JP Morgan analysts believe that, technically, the price of Bitcoin will reach $ 130,000, in the event that it becomes a new digital gold formation.
The bank’s analysts said in a research note that the decline in the price of gold gives Bitcoin an opportunity to rise, as it is a digital alternative.
In early January, GB (CA: AUTO) Morgan set a long-term target for Bitcoin, claiming that the cryptocurrency could rise to $ 146,000 as it competes with gold as an “alternative” currency.
The market value of Bitcoin at the time was more than $ 575 billion, while it is now more than three times near the levels of $ 1.1 trillion.
According to JP Morgan, the price of Bitcoin is supposed to rise 4.6 times, to parity with private sector investment in gold, which amounts to $ 2.7 trillion.
JPMorgan (NYSE: JPM) has set a condition for the market value of Bitcoin to reach this level, represented by the necessity of significantly lowering its price fluctuations to give institutional investors the confidence required to make big bets.
Strategists at JP Morgan said this long-term upward trend based on the equation of Bitcoin’s market value against gold for investment purposes is conditional on Bitcoin’s volatility along with gold’s long-term volatility.
The reason, they added, is that, for most institutional investors, the volatility of each class is important in terms of portfolio risk management and the greater the volatility of the asset class, the greater the risk capital consumed by that asset class.
And unlike crypto analysts, JPMorgan argues that there is little doubt that the institutional flow drive of Bitcoin is what distinguishes the rise of 2020 from 2017.
The investment bank believes that it is unlikely that the fluctuations between Bitcoin and gold will converge quickly, which means that the theoretical target price for Bitcoin above $ 146,000 should be considered a long-term goal, and thus an unsustainable price target for this year.
In contrast to JPMorgan analysts’ opinion, Bank of America analysts said in a recent research note, inflows of only $ 93 million would move Bitcoin’s price by one percent.
“Bitcoin is very sensitive to the increased demand for the dollar,” said Francisco Blanche, a strategist at Bank of America (NYSE: BAC).
And the note that some see reaping from Bitcoin in recent months stated that it would take at least two billion dollars of inflows to move the price of gold by one percentage point.
Whereas, more than $ 2.25 billion is needed to exert the same price effect on Treasuries of 20 years or more.