Back in its hayday, Bitcoin (BTC), along with some other cryptocurrencies, was at the top of its game. Recently however, the crypto market has been showing major signs of volatility for quite some time now with valuations dropping with huge percentages. And it seems like the king of the crypto hill; Bitcoin is caught up in a game of “how low can you go?” Considering the amount of times its price has dropped, we are left wondering, how low can it go indeed.
Well, according to the analysts at JP Morgan, it is likely that Bitcoin will continue its fall. As per Reuters report on Jan. 24, the analysts have predicted that Bitcoin could fall below $1,260.
According to the report, analysts from the major global investment bank are of the opinion that the true value of cryptos is still unproven. They further added that the whole concept of cryptos only makes sense in a hypothetical situation, or as they put it, in a “dystopian” event, where a number of investors have lost faith in the major traditional assets like gold and the U.S. dollar.
Even in extreme scenarios such as a recession or financial crises, there are more liquid and less-complicated instruments for transacting, investing and hedging [than cryptocurrencies].
The analysts stated in the report.
The report also claimed that handling payment via cryptos would remain as challenging as ever, on the grounds that the firm itself failed to find any major retailers that were wiling to accept cryptos in reality in 2018.
Moreover, JP Morgan also pointed out the fact that involvement in the crypto market at an institutional level, has slumped over the course of past six months. Which leaves majority of the market in the hands of individual traders.
Going back to the Bitcoin price, the analysts further suggested that Bitcoin could possibly drop down to around $2,400, and under the circumstances that the current bear market persists, could even fall below $1,260.
In addition to the fall of Bitcoin price, the analysts also discussed on its underlying technology. The report claims that banks will not be able to reap benefits from blockchain for at least three to five years. But, JP Morgan didn’t discredit the technology in its entirety. The investment bank still recognized the distributed ledger technology’s (DLT) potential to cut costs for global banks and digitize various complex processes.
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