Top Stories

Risks & Opportunities Of Investing In Cryptocurrencies – JPMorgan Report

JPMorgan has released a new report to its private banking clients to teach them the risks and opportunities of investing in cryptocurrencies.

As per the report, which was outlined earlier in February 2021, has been distributed to clients of JPMorgan Private Bank, which needs a minimum balance of $10 Mln to open an account.

The comes after CNBC reported earlier in February that JPMorgan co-president Daniel Pinto claimed “demand isn’t there yet” from clients for cryptocurrency services, but it “will be there at some point in future.”

The report breaks down how Bitcoin [BTC, +0.77%] might be valued, applying three different metrics: the number of users, the worth of gold, and therefore the global funds.

1. If applying a version of Metcalfe’s law – that bitcoin’s value is proportional to the square of the number of users – it might be worth $21,667 USD.

2. If applying the present value of gold to the max supply of 21 Mln bitcoin, it might be valued at $540,814 USD.

3. Whereas applying the worldwide value of cash to bitcoin’s max supply would place the crypto assets valuation at $1.9 Mln.

Risks & Opportunities Of Investing In Cryptocurrencies - JPMorgan Report

The report plays down bitcoin’s common comparison to gold. Despite having diversifying properties, bitcoin’s “volatility characteristics and correlation profile refute the comparison to the existing shelter assets.”

Leave a Comment

Your email address will not be published. Required fields are marked *