JPMorgan issued an official statement earlier on Thursday that Bitcoin [BTC, +0.62%] might fetch a long-term price of $130k if its volatility continues to go down.
In line with JPMorgan, Bitcoin is becoming more appealing to institutions seeking low-correlation assets that diversify portfolios, Business Insider reported earlier on Thursday.
The United States investment bank outlined that prime volatility “acts as a headwind towards further institutional adoption.”
The signs that bitcoin’s volatility is diminishing could see it “crowding out gold” as a portfolio diversifier and suggests a long-term price target of $130k, JPMorgan’s note said.
This target is predicated on the notion that bitcoin’s volatility will meet gold’s, which for the nonce remains some way off. Bitcoin’s realized volatility within the past 3-months stood at 86% compared to 16% for gold.
A separate JPMorgan report issued to ultra-high-net-worth clients earlier in March played down the comparison between bitcoin and gold, arguing that the crypto’s “volatility characteristics and correlation profile refute the comparison to the traditional safe asset.”