Will Bitcoin overtake gold? J.P. Morgan Chase doesn’t think so.
Analysts at JP Morgan are reporting large institutional investors are leaving bitcoin in favor of gold. Despite Bitcoin reaching above $64,000 last month, the $30,000 lows in this bear market are making investors uneasy.
J.P. Morgan said the cryptocurrency’s futures now show the first biggest drop since the bull market began last year.
“The bitcoin flow picture continues to deteriorate and is pointing to continued retrenchment by institutional investors,” the report said. “Over the past month, bitcoin futures markets experienced their steepest and most sustained liquidation since the bitcoin ascent started last October.”
The leading cryptocurrency has been known as digital gold, which has aided the coin’s growth and confidence among investors. J.P. Morgan analysts previously predicted that BTC would hit $140,000 over the long-term, noting it would be a “multi-year process.”
“This $140k price should be thought of as a long-term theoretical target assuming a convergence of Bitcoin volatility to that of gold and an equalization of bitcoin allocations to that of gold in investor portfolios.”
However, with Bitcoin’s extreme volatility, fair market value according to J.P. Morgan would be a quarter of the $140,000 prediction, ringing in today at $35,000. In a single day, Bitcoin crashed from above $43,000 to under $31,000.
Bitcoin is very speculative at the moment and hard to compare to gold’s reigning history as the staple world currency for centuries. While Bitcoin crashed, gold saw a 6% increase during the past month.
Meanwhile, China is warning the industry to steer clear of digital currencies altogether and buying up gold by the tonnes.
“Financial institutions, payment institutions and other member units must earnestly strengthen their social responsibilities. They must not use virtual currency to price products and services, underwrite insurance businesses related to virtual currencies or include virtual currencies in the scope of insurance liability, and must not directly or indirectly provide customers with other services,” came the warning issued by China Banking Association, the National Internet Financial Association of China, and the Payment and Clearing Association of China.
Communist China is nothing to compare ourselves to, but even they understand the strength of gold and instability of speculative cryptocurrencies.
Industry experts and financial institutions alike know when inflation hits, gold will skyrocket. Jim Rickards predicts a $15,000 gold in the near future, with others predicting a $10,000+ valuation. Market manipulation and minting companies inability to fulfill their orders point to a clear $10,000 price without the volatility of bitcoin.
There’s no time to waste. Countries like ours will see inflation slowly… and then all at once.
Stock pile gold while you can. Call us to learn about your FREE ounce of gold at 800-617-5373
