Bitcoin is up nearly 19% this week, reaching a market cap of $ 1 trillion. According to the largest cryptocurrency exchange Binance, the maximum Bitcoin price this week was recorded in the morning and amounted to $ 56,100. The largest US bank JPMorgan believes the rally was fueled by institutional investor confidence in Bitcoin as a hedge against inflation losses.
“Renewed inflationary concerns among investors have rekindled interest in using bitcoin as a hedge of inflation,” JPMorgan analysts explained. They also believe there has been an important shift in the perception of the merits of bitcoin in relation to gold: “Institutional investors seem to be returning to bitcoin, seeing it as a better inflation hedge than gold.”
In a May report, JPMorgan analysts noted that large investors preferred gold over bitcoin. Now the situation has changed. The new rally, experts explained, was caused by two factors: these are statements by American politicians who are not going to ban cryptocurrencies or their production in the United States and the introduction of bitcoin in El Salvador, as well as the growth of the Lightning network that coincided with it.
Unlike other analysts, JPMorgan has not cited rumors circulating around the pending approval of Bitcoin ETFs, referring to Bitcoin’s appreciation.
Despite the growing interest in cryptocurrencies from some JPMorgan divisions, CEO Jamie Dimon continues to be an opponent of digital currencies. In late September, in an online interview with the Times of India, he stated that he was still skeptical of the first cryptocurrency, although this does not mean that Bitcoin will not be able to grow much in the next ten years.
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