Bitcoin (BTC) has lead a 35% rebound this week, flying well past the $50,000 barrier level and recovering the asset’s $1 trillion market value. As per a note distributed with customers on Thursday by JPMorgan, the latest rise in the price of BTC was mostly attributable to institutional investors seeking for a hedge against inflation.
“The re-emergence of inflation worries among investors has revived interest in the use of Bitcoin as a hedge against inflation,” the analysts said, claiming that there has been a change in opinion about the advantages of BTC in comparison to gold.
“Institutional investors seem to be flocking to Bitcoin, possibly because they view it as a stronger hedge against inflation than gold.” Institutions isn’t the only ones present:
Kevin O’Leary, a Shark Tank star, revealed a few days back that cryptocurrency now has a bigger allocation in his portfolio than gold. The recent surge in interest in Bitcoin contrasts with a JPMorgan study from May, in which analysts highlighted that large investors were shifting away from Bitcoin and toward conventional gold.
JPMorgan cited two other criteria that it trusts are driving the current uptrend: “latest declarations by the US policymakers that there is no desire of following China’s steps toward prohibiting the use or mining of cryptocurrencies,” and also “the latest surge of the Lightning Network and 2nd layer payments solutions, aided by El Salvador’s Bitcoin adoption.”
The implicit endorsement of Bitcoin by major banks and regulators is going to accelerate the collapse of #Gold and the rise of #Bitcoin as the preferred safe-haven store of value for both institutional and retail investors.https://t.co/7os1ojenHs
— Michael Saylor⚡️ (@michael_saylor) October 7, 2021
JPMorgan, regardless of other analysts this week, did not mention speculation about the impending authorization of a Bitcoin futures ETF as a primary factor of the price.
while writing this article, BTC was trading at $55,853 on Coingecko. In spite of JPMorgan’s increasing interest in crypto assets and blockchain projects, CEO Jamie Dimon said in an interview on Oct. 22 that he remains cynical of BTC, comparing it to “a little bit of fool’s gold.”
