Month: Januar 2021

JP Morgan says bitcoin’s descent could continue

JP Morgan says bitcoin’s descent could continue

A report from JP Morgan has been released claiming that the current bitcoin price decline could continue until the end of March.

The lengthy report (28 pages) analyses a lot of data and metrics, as well as bitcoin’s history over the past few years, and comes to the Immediate Bitcoin conclusion that a price of around $35,000 should currently be considered as the upper limit of the fair value range.

This conclusion therefore leads analysts to believe that unless BTC’s price volatility eases rapidly, the goal of reaching $50,000 or even $100,000 by year-end is not sustainable.

However, it must be said that this report is three days old, and indeed volatility has reduced in recent days.

According to the same analysis the lower bound would be $11,000, so for JP Morgan analysts the current fair value of BTC would be between $11,000 and $35,000, with the average being $23,000.

What influences the price of Bitcoin according to JP Morgan

The report however clearly highlights that, compared to 2017, the current price rally is mainly due to institutional capital inflows into this market, but assumes that among these not all constitute long-term investments, and instead there is a good speculative component.

In addition, there was also a strong retail component, particularly from services such as PayPal, but this had subsided in the last two weeks.

In order to start a new bullish impulse, they argue that the price would have to return to above $40,000 soon, otherwise the descent could continue until the end of March, but as things stand at present there does not seem to be a basis for a return to above $40,000.

However, in the long term, they reiterate the theoretical price target of $146,000 that was suggested a few weeks ago.

The report also argues that bitcoin should still be regarded as a risky asset, rather than a safe asset, which, for example, shares with gold an increased correlation with the S & P500 from March 2020 onwards.

The most important bitcoin news of the week

BlackRock toying with Bitcoin investments; Phase 1 at Ethereum 2.0; Ex-Ripple advisory board could become OCC boss; TenX deactivates accounts and Visa cards, and Deutsche Bank survey sees bubble potential in Bitcoin and US tech stocks.

Another exciting week in the crypto space is coming to an end. The most important events around Bitcoin and Co. in a compact overview

The largest asset managers in the world rises may be a doubly in the crypto business. That emerges from two filings the financial giant has filed with the Securities and Exchange Commission(SEC) has filed. Specifically, it concerns the two funds „BlackRock Global Allocation Fund“ and „BlackRock Funds V“. BlackRock has submitted an amendment to the respective securities prospectus for both of them with the US Securities and Exchange Commission. The applications indicate that investments in Bitcoin futures will also be reserved in the future. BlackRock will also point out potential risks in the forms submitted. Among other things, this means the volatility of the cryptocurrency, any regulatory measures and the difficulties in determining the price of digital gold. BlackRock also plans to trade Bitcoin Evolution exclusively on exchanges that are subject to the supervision of the Commodities and Futures Trading Commission (CFTC). The BlackRock was already flirting with the cryptocurrency in December.

Ethereum 2.0 is moving towards phase 1

The conversion of the consensus procedure to a proof-of-stake model in the course of Ethereum 2.0 is in full swing. Ether enthusiasts will still have to be patient until Ethereum 2.0 is finalized. According to Ethereum developer Danny Ryan, the transition is in phase 1planned for the second half of 2021. The process is currently still in phase 0. The changes that the proof-of-stake model entails are tested using a test chain, the beacon chain. The transition to phase 1 then extends the network to include the sharding function. The beacon chain is initially extended by 64 shard chains. By splitting the processing of transactions into several parallel chains. This increases the transaction throughput considerably and is therefore an essential key to solving the scaling problems that the crypto network currently still has. The subsequent final phase would end the transformation to Ethereum 2.0.

Ex-Ripple advisory board could become the new OCC boss

As the Wall Street Journal reports, President Biden is toying with the idea of making Michael Barr the new head of the Office of the Comptroller of the Currency ( OCC ). The financial magazine claims to have found out from internal circles. Barr worked in the US Treasury Department under the Obama administration. The change could also be of interest to Ripple’s legal battle with the SEC. Michael Barr has been on the advisory board of the Californian FinTech since 2015. Should he actually get the chief post of the currency regulator, he could act as a mediator between Ripple and the SEC. Another aspirant for the job is Mehrsa Baradaran. She is Professor of Banking Law at the University of California, Irvine School of Law. The OCC did not want to comment on the rumors about Michael Barr to BTC-ECHO.