JPMorgan Predicts BTC Will Rise to $126,000 by Year-End
Acryptoinvest.news: Bitcoin's current price is “too low” compared to gold as its volatility falls to record lows, according to JPMorgan analysts.
Bitcoin's volatility has dropped from nearly 60% at the start of the year to around 30% now, an all-time low. As a result, analysts led by managing director Nikolaos Panigirtzoglou released a report on Thursday suggesting that Bitcoin's fair value is around $126,000.
“Yes, this is the very positive point that we highlighted in our note, and we expect to achieve it by the end of the year,” Panigirtzoglou said, sharing specific deadlines.
The surge in corporate Treasury bond purchases, which now account for more than 6% of the total supply of bitcoin, has played a major role in dampening volatility. JPMorgan compared the dynamic to central bank quantitative easing after 2008, which smoothed bond market volatility by locking assets into passive assets.
The passive inflow of funds into Bitcoin is also driven by global inclusion of stock indices. Analysts noted that the inclusion of Strategy (formerly MicroStrategy) in major benchmarks has already attracted new investment, while Metaplanet’s elevation to mid-cap status in the FTSE Russell indices has led to its inclusion in the FTSE All-World index.
Meanwhile, competition among corporate treasury firms is heating up. Nasdaq-listed KindlyMD has filed to raise up to $5 billion, choosing bitcoin as its primary reserve, while Adam Back’s BSTR is reportedly seeking to rival Marathon Digital for the title of second-largest corporate holder after Strategy.
Analysts noted that the combination of corporate treasury accumulation, index-driven inflows, and lower volatility makes bitcoin more attractive to invest in. They added that lower volatility makes it easier for institutional investors to allocate capital, as bitcoin and gold are now closer than ever on a risk-adjusted basis.
The analysts note that the Bitcoin-to-gold volatility ratio has fallen to 2.0, the lowest on record. This means that Bitcoin currently consumes twice as much risk capital as gold in portfolio allocations. Based on this, Bitcoin’s $2.2 trillion market cap would need to grow by about 13%, implying a theoretical price of $126,000, to match the roughly $5 trillion in private gold investment. The analysts also noted that the gap between Bitcoin’s price and its fair value has narrowed from $36,000 at the end of 2024 to about $13,000 below that level today, indicating further upside potential.
Source: cryptonews.net
