JP Morgan Expect Bitcoin (BTC) To Plunge
According to an exclusive report from Reuters, JP Morgan’s very own analysts have begun to express cynicism towards cryptocurrencies, namely Bitcoin. The Wall Street giant, whose chief executive Jamie Dimon has overtly bashed BTC multiple times historically, released a report on its crypto & blockchain expectations on Thursday.
In the research piece, analysts from JP Morgan, a multinational investment and financial services household name, first claimed that digital assets, along with blockchain technologies and similar innovations, will likely have close to zero impact on financial incumbents for a minimum of three to five years.
Analysts from the firm even claimed that the value proposition of cryptocurrencies (not digital assets), namely Bitcoin, is limited, noting that such digital Mediums of Exchange (MoE) and Stores of Value (SoV) would only be truly viable if the gold, U.S. fiat, and other government-issued currencies collapsed. While there are many that beg to differ — claiming that BTC is viable as a digital semblance of gold — the analysts seemed adamant in maintaining their belief system. They wrote:
Even in extreme scenarios such as a recession or financial crises, there are more liquid and less-complicated instruments for transacting, investing and hedging.
JP Morgan’s researchers went on to touch on the status of crypto’s ecosystem, noting that Bitcoin futures trading via financial institutions has waned as BTC started to enter a round of tumult in Q3 of 2018. It was added that pension funds and asset managers have also steered clear of cryptocurrencies, as fears remain regarding crypto’s underlying volatility, security flaws, and ability to be used in seeming illicit acts. JP Morgan added that Bitcoin’s purported raison d’etre of being a digital form of cash has been flawed, drawing attention to the lack of adoption from corporations.
And with all this in mind, the bank’s analysts determined that BTC could find support at $2,400, but could fall below $1,260 if the bear market persists. Judging their aforementioned comments, it’s clear they still don’t see value in certain cryptocurrencies, even BTC.
Interestingly, in spite of the harrowing forecast, the company, save for its chief executive, has expressed interest towards the broader crypto ecosystem previously. In early-November, the company revealed that it was seriously committed to an Ethereum-based application, which would allow consumers and Wall Street institutions to tokenize certain products. In May, the company implemented a crypto strategy, hiring Oliver Harris to head its internal crypto team.
Crypto Analysts More Optimistic
JP Morgan’s forecast is well below what crypto’s dedicated traders believe the flagship cryptocurrency will find a long-term floor at. As reported by Ethereum World News previously, Murad Mahmudov claimed that if history rhymes (as it often does), BTC could find itself at $1,700 by Spring, likely in April. Mahmudov noted that some cryptocurrencies remain overvalued, also noting that historical analysis indicates that BTC could fall lower before trending higher.
However, the even more optimistic commentators in the broader crypto sector have claimed that BTC won’t even near the $1,700 mark, let alone anything under that. Per previous reports from us, Joseph Lubin, the founder of Ethereum developer ConsenSys, called a market bottom just one week after BTC hit $3,150. And since then, prices haven’t revisited that level.
More recently, Anthony Pompliano of Morgan Creek told Ran NeuNer of CNBC Africa that BTC will likely range trade between $2,500 and $4,500 for the months to come. Vinny Lingham of Civic echoed this sentiment, noting that BTC is likely to fall under $3,000 (but not too much farther), but then continue to trade in a tight range for months to come.
While their comments may seem disconcerting, the aforementioned two investors made it clear that BTC and other cryptocurrencies are likely to head higher… eventually.
Title Image Courtesy of Andre Francois Via Unsplash