The long-term theoretical aim for Bitcoin, according to JPMorgan, is $150,000, up from $146,000 in January 2021.
JPMorgan researchers stated that Bitcoin’s “fair value” is actually lower than its market price on Tuesday, despite the cryptocurrency’s substantial price rise since early February.
According to JPMorgan strategists, the current fair-value threshold for BTC is roughly $38,000, according to the bank’s latest investor note published on Tuesday. The strategists, led by JPMorgan crypto market analyst Nikolaos Panigirtzoglou, calculated the “fair value” based on Bitcoin’s volatility being roughly four times that of gold.
The “fair value” of Bitcoin would grow to $50,000 in a situation where volatility is reduced by three times, according to the strategists.
“Bitcoin’s main issue in the future will be its volatility, as well as the boom and bust cycles that stymie greater institutional use.”
BTC was trading around $43,000 at the time of writing, up 12% from JPMorgan’s suggested “fair value.” According to CoinGecko data, Bitcoin was previously hovering around $45,000, peaking roughly $44,900 on Tuesday.
Despite being negative on Bitcoin’s present “fair value,” JPMorgan strategists believe it could one day soar far over $100,000. Panigirtzoglou’s long-term theoretical aim for Bitcoin, according to the paper, is $150,000, up from $146,000 predicted in January 2021.
According to JPMorgan’s analysts, Bitcoin’s price adjustment in January appears “less like a capitulation” than the one that occurred in May 2021, when BTC fell 50% from above $60,000 to roughly $33,000. Some BTC data, such as futures open interest and exchange reserves, however, indicate to a “longer-standing and consequently more alarming position reduction trend” that began in November, according to the strategists.
In November, the strategists published a paper claiming that Bitcoin’s “fair value” was roughly $35,000, or around 45 percent less than its current market price of $63,281.