Bitcoin's historical or realized volatility is beginning to normalize, according to JPMorgan, who estimate that the cryptocurrency may displace gold as a reserve asset and be worth up to $470.000 by the end of this year.
JPMorgan, one of the largest financial institutions in the United States, says that the historical or realized volatility of Bitcoin (BTC) is getting smaller. According to their data, Bitcoin volatility has fallen by 86% in the last 3 months, which is favoring its adoption at the institutional and corporate level. The entity's analysts also consider that Bitcoin can displace gold as a reserve of value asset, and that its price can reach between $130.000 and $470.000 by the end of the year.
In a report shared with Bloomberg, Nikolaos Panigirtzoglou, JPMorgan strategist noted that the “normalization of Bitcoin volatility” is encouraging, and that it is giving tentative signs for entities, including banks, to begin looking towards this again. cryptocurrency.
Panigirtzoglou expressed that lower volatility in Bitcoin prices will likely help revitalize its institutional interest in the future, while corporate investment will drive its price to new highs. The investment firm ARK Invest, founded and run by Catherine Wood, also shares JPMorgan's vision, stating that in reality, Bitcoin has the potential to reach up to $500.000 per unit in the near future.
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Bitcoin, a better reserve asset than gold
JPMorgan analysts have already spoken out in favor of Bitcoin as an asset that performs better as a store of value than gold; the most valued precious metal in the world for centuries.
In November, JPMorgan analysts noted that a large part of institutional investors see Bitcoin as a better investment alternative and store of value than gold. For some time now, Wall Street investors have been showing interest in learning about and having exposure to this cryptocurrency, and are even interested in knowing how bitcoins are mined within the network.
Its properties and characteristics have led many experts to consider BTC as the new digital gold or gold 2.0. Thus, now that the volatility of this cryptocurrency has decreased considerably, JPMorgan analysts assure that the cryptocurrency will begin to attract a greater number of institutional investors, who have stayed away from crypto investment due to price instability. in the market.
According to the report, in the last three months the volatility of the cryptocurrency has fallen by 86% in the market, after having increased above 90% in the month of February. The same volatility of the cryptocurrency measured in six months shows that the metric is actually stabilizing in the market, around 73% on average.
Banks and Bitcoin services
BBVA, one of the most important banks in Spain, opened its Bitcoin services from its subsidiary in Switzerland last year; although he recently indicated that these would not be extended to other branches of the bank due to the price instability of Bitcoin, a product of volatility.
For their part, several American commercial banks, such as Morgan Stanley and Bank of New York Mellon, are preparing to offer bitcoin services to their clients and users. Morgan Stanley is waiting for authorization from the United States Securities and Exchange Commission (SEC) to include the option of investing in bitcoin within 12 investment funds. BNY Mellon is joining the trend of adopting blockchain and bitcoin, to offer financial services with the cryptocurrency and to use new technologies to build the banking industry's first multi-asset digital platform.
Continue reading: JPMorgan: Institutional investors see Bitcoin as a better alternative to gold
