$146000? JP Morgan is back to “sing more” bitcoin

Bitcoin, once referred to as “rat drug” by Warren Buffett, has been booming recently. Its market value once soared to $628 billion, more than $80 billion higher than Berkshire. Maybe this will make Mr. Buffett doubt his life. According to JPMorgan’s Nikolaos panigirtziglou’s strategy team, bitcoin’s sharp rise in the past few weeks has made its positioning and valuation more challenging. In addition, the increase of speculative long positions and individual investors holding a small amount of bitcoin may further spread the speculative boom, pushing the price of bitcoin to $50000-100000. However, although there are short-term concerns, in the long run, bitcoin is “stealing money” with gold. Considering that bitcoin is the “alternative currency” of gold, bitcoin has the potential for further substantial growth. If bitcoin market wants to compete with the current private investment volume of $2.7 trillion in the gold market, the current market value of $575 billion is far from enough. It needs to be greatly expanded by 4.6 times, that is to say, the unit price should reach 146000 US dollars. However, the long-term goal of US $146000 will not be achieved overnight, which depends on the volatility of bitcoin in the future. For most institutional investors, the volatility of each class will affect the risk management of portfolio. The higher the volatility of an asset class, the greater the risk. After breaking through $34000 for the first time, bitcoin fell as much as 17% on Monday, the biggest drop since March. Still, the price of the world’s largest cryptocurrency has quadrupled in the past year. After admitting two months ago that it was wrong to predict the end of the bitcoin bull market, JP Morgan became a staunch “bull” for bitcoin. “Squeezing an ‘alternative’ currency out of gold means there is a lot of room for bitcoin to rise in the long run,” said Nikolaos panigirtzoglou’s strategy team at JPMorgan Chase If bitcoin market wants to match the current private investment volume in gold market, the current market value of 575 billion US dollars is far from enough. It needs to be greatly expanded by 4.6 times, that is to say, the unit price should reach 146000 US dollars. Why 4.6 times? JP Morgan said that most of the current private gold wealth is gold bars and gold coins, including gold ETFs, which have a total inventory of 42600 tons (excluding gold bars and gold coins held by the central bank), totaling $2.7 trillion. As far as bitcoin’s valuation is concerned, strategists say two indicators have been used before, one based on gold comparison and the other based on mining costs or intrinsic value. According to strategists, the size of the grayscale bitcoin trust’s allocation to LTC is as high as 87% of its total portfolio, while its allocation of gold is only 17%. That is to say, their investment in the special currency is 5.1 times of that in gold. The proportion of general funds is between 3.4 and 5.1 times, which means that the ratio of average risk capital allocation of bitcoin fund to that of gold is close to 4.6 times. In other words, from the perspective of venture capital, bitcoin is already comparable to gold in attracting private investment other than central banks. Therefore, JP Morgan believes that “the current price range of $50000 to $100000 is a sustainable target price range”, and this market consensus expectation is actually risky. Gold ETFs have seen outflows of more than $7 billion since mid October. In the view of strategists, bitcoin can “put pressure on gold” because of the interest of millennials in bitcoin. As time goes on, young investors will inevitably become the main force of investors. “. In terms of mining cost or intrinsic value, the ratio of bitcoin market price to intrinsic value again reached its peak at the end of 2017, which does not mean that mining costs are driving market value, or vice versa. However, this does not mean that bitcoin prices will continue to deviate from its mining costs. Similar to gold, when the market price of bitcoin is much higher than the production cost, the mining activities and difficulties will increase, and the production cost will be pushed to the market price, resulting in a certain convergence. Short term risk cannot be ignored, because of volatility, bitcoin’s long-term goal will take a while. In fact, from Paul Tudor Jones to Scott minerd and Stan Druckenmiller, more institutions and prominent investors have begun to allocate money to bitcoin, or are willing to do so. Some investors believe cryptocurrency can hedge against a weak dollar. Some investors believe that cryptocurrency can also cope with inflation risks and bubbles in an environment full of fiscal and monetary policy stimulus. However, the short-term risk of bitcoin can not be ignored. The increase of speculative long positions and individual investors holding a small amount of bitcoin is considered by JP Morgan as the biggest adverse factor for bitcoin at present, because the increase of these indicators may indicate the potential bubble of bitcoin. The figure below shows the daily surge in bitcoin transactions: The figure below shows the growing number of bitcoin accounts: “While we can’t rule out the possibility that the current speculative boom will spread further, bitcoin prices will be pushed to $50000-100000, but we believe that such a price level is unsustainable.” 2020 can be seen clearly, and 2021 will pass through Niu Xiong! How to predict the trend of assets in the year of the ox? Come to the venue to see the choice of millions of wall street users! Tear calendar 100% to win benefits and chances to win iphone12

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