JPMorgan said that the fair price of Bitcoin is 28% greater than its current one, indicating that the leading digital asset has “considerable upside from here.”
According to a report by Market Insider, the bank said in a report released on May 25 that cryptocurrency has eclipsed real estate as a prefered “alternative asset class.”
Alternative assets are investments that do not fit into standard classifications such as bonds and stocks. The bank said unequivocally that $38,000 was a suitable price for Bitcoin. This was a 28% increase from Bitcoin’s Wednesday morning price of $29,700.
Bitcoin as an ‘alternative asset class.’ Image: Getty Images
The strategists of the American banking giant, including Nikolaos Panigirtzoglou, wrote:
“The past month’s crypto market correction looks more like capitulation relative to last January/February and going forward we see upside for Bitcoin and crypto markets more generally.”
“We thus replace real estate with digital assets as our preferred alternative asset class along with hedge funds.”
As a consequence of rising inflation and interest rates, the crisis in Ukraine, and China’s economic slowdown, investors have fled risky assets, resulting in a decrease in the value of cryptocurrencies in 2022.
Since the beginning of the year, Bitcoin prices have decreased by about 37%, while the worldwide market capitalisation has decreased by nearly $1 trillion. From a November peak of almost $3 trillion to a May low of $1.3 trillion, the total market value of all cryptocurrencies has declined dramatically.
However, according to JPMorgan, the sell-off was more destructive to the value of cryptocurrencies than the value of other alternative assets such as real estate, private equity, or private debt.
Experts in the sector also highlighted that there would be more potential for cryptocurrencies to recover.