the american bank JP Morgan expressed that the Bitcoin fair price is 28% higher than its current levelimplying a “significant run higher from here” following a dramatic cryptocurrency sell-off.
The bank noted in a note on Wednesday that cryptocurrencies have overtaken real estate as one of its “alternative assets”preferred, meaning assets that don’t fall into typical categories like stocks and bonds.
JP Morgan noted that it stood by its view that USD 38,000 was a fair price for Bitcoin. This figure is 28% higher than the level of USD 29.500 of the main cryptocurrency this Wednesday..
“The correction of the cryptocurrency market last month looks more like a capitulation relative to last January/February and, in the future, we see an increase for Bitcoin and the cryptocurrency markets in general,” said the bank’s strategists, including Nikolaos Panigirtzoglouin the note.
Las cryptocurrencies have fallen in 2022 because the rising inflation and rates of interest, the war in Ukraine and the slowdown in China caused investors to dump assets considered risky.
At its all-time high, the value of Bitcoin reached almost USD 69,000 and continues to be the most popular cryptocurrency in this digital market.
The Bitcoin lost around 37% in the year, while Ethereum it plummeted regarding 48%. The total market value of all cryptocurrencies plummeted from regarding $3 trillion in November to $1.3 trillion in May.
However, JPMorgan warned that the Liquidation Had Hurt Cryptocurrencies More Than Other Investments alternatives such as private equity, private debt and real estate. That suggests there is more room for cryptocurrencies to recover, strategists anticipated in the report.
In 2022 Bitcoin lost regarding 37% while Ethereum plummeted regarding 48%
“Therefore, we replace real estate with digital assets as our preferred alternative asset class alongside hedge funds,” they wrote.
The dramatic collapse of the stablecoin TerraUSD and the cryptocurrency LUNA connected had soured sentiment among many crypto investors, strategists said. However, they added that so far there is little sign that venture capital funding in crypto is drying up.
However, the investment bank said it was now less interested in alternative investments, changing them to an “underweight” rating from “overweight” previously.
The total market value of all cryptocurrencies sank from $3 trillion in November to $1.3 trillion in May.
Las cryptocurrencies they are an innovative digital asset that has experienced monumental growth in recent times due to several contributing factors, among which can be listed the current outbreak of the COVID-19 pandemic or even that some governments have decided to give them a opportunity as legal tender.
With this in mind, more and more people have started to acquire cryptocurrencies to be able to invest in something “safe” and “reliable” both in the short and long term, despite the extreme levels of volatility that it constantly suffers.
A cryptocurrency or cryptocurrency it is a digital means of exchange, since it does not exist physically, who wears a cryptographic encryption to ensure the integrity of transactions and maintain control over the creation of new units.
JPMorgan warned that the liquidation of financial assets had hurt cryptocurrencies more than other alternative investments
The first cryptocurrency to be born was Bitcoinin 2009 and since then others equally known as Litecoin, Ethereum, Bitcoin Cash, Ripple, Dogecoinamong other.
Cryptocurrencies have various characteristics that make them unique, such as the not be regulated or controlled by any institutionthey do not require intermediaries in transactions and accounting blocks are used to prevent new cryptocurrencies from being created illegally.
However, by not having regulators such as a central bank or similar entities, they are pointed out not being reliable, being volatile, promoting fraud, not having a legal framework that supports its users, allowing the operation of illegal activitiesamong others.
To acquire them, you can buy or exchange the currency itself in specialized portals. Its value varies depending on the supply, demand and commitment of usersso it can change faster than traditional money, but the more people are interested and want to buy a given currency, the higher its price.
However, whoever invests in this type of digital assets must be very clear that this form brings with it a high risk to capitalWell, just as there can be an increase, it can also have an unexpected crash and end the savings of its users.
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