Analysts at JPMorgan Chase compare Bitcoin’s potential to that of gold on a volatility-adjusted basis, predicting that it might reach $266,000 in the long run. The projection makes the assumption that during times of global stress, Bitcoin will become an equally alluring hedge.
According to the bank, Bitcoin is now more attractive on a risk-adjusted basis because its volatility in comparison to gold has dropped to all-time lows. Analysts emphasized that the goal depends on sentiment improving and is not feasible for the current year.
Recent declines in technology equities and corrections in traditional safe assets have put pressure on cryptocurrency markets. In just one day, Bitcoin fell around 10%, trading at about $63,600, momentarily below its estimated cost of manufacture.
The production cost of Bitcoin is now estimated by JPMorgan to be about $87,000.
Extended trading below this level could force inefficient miners to exit, eventually lowering costs as mining difficulty adjusts.
Despite recent weakness, derivatives liquidations have been milder than last quarter, and stablecoin supply contraction is seen as a natural response to a smaller overall market rather than an exit from crypto.
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