Bitcoin Will Be Bullish, JP Morgan Predicts Over Expected Inflations.
Gobal investment bank JPMorgan says inflation worries are pushing the price of bitcoin to record highs, rather than interest in recently launched bitcoin futures exchange-traded funds (ETFs). Noting that investors are fleeing from gold ETFs into bitcoin funds, the firm noted, “The flow shift remains intact supporting a bullish outlook for bitcoin into year-end.”
JPMorgan Chase’s analysts, led by Nikolaos Panigirtzoglou, published a research note last week explaining that inflation has been driving up the price of bitcoin to all-time highs rather than the hype around the first U.S. bitcoin futures exchange-traded fund (ETF).
The JPMorgan analysts believe that “By itself, the launch of BITO is unlikely to trigger a new phase of significantly more fresh capital entering bitcoin,” elaborating:
Proshares Bitcoin Strategy ETF, ticker BITO, began trading Tuesday and rapidly amassed $1 billion in investments. The second bitcoin futures ETF in the U.S. launched Friday.
Instead, we believe the perception of bitcoin as a better inflation hedge than gold is the main reason for the current upswing, triggering a shift away from gold ETFs into bitcoin funds since September.
The analysts added that “The initial hype with BITO could fade after a week.”
The price of bitcoin soared to an all-time high of $66,899 based on data from Bitcoin.com Markets on Tuesday. At the time of writing, BTC’s price is around $61,249. It has risen approximately 40% since the beginning of the month and more than 90% since the beginning of the year. The price of BTC rose significantly when the market anticipated the approval of a bitcoin futures ETF by the U.S. Securities and Exchange Commission (SEC).
Not only have the JPMorgan analysts explained that the real driver behind the price increase of bitcoin was growing concerns over inflation, but they have also noted that it has pushed investors to seek investments that can act as a hedge against this risk, such as gold and bitcoin.
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