FX.co ★ J.P.Morgan analysts consider bitcoin as the worst investment diversification asset

The bitcoin exchange rate reached the value of $58,000 per coin this weekend, and this time without the outright help of Elon Musk or other investment whales. Thus, the exclusively speculative growth of the cryptocurrency, as well as the entire cryptocurrency market, continues. More and more large and small traders are joining the trend, as they also want to make money on the second major growth of bitcoin. The figure of $100,000 per coin, which would have seemed fantastic a couple of months ago, now looks absolutely real, considering that bitcoin is becoming more expensive almost every day, adding several thousand dollars. Digital assets are still gaining popularity, but this popularity is again "hype." If bitcoin collapses to $5,000 per coin tomorrow, it is unlikely that all the media and news agencies will review its next fall every day and quote Elon Musk's posts on Twitter.

Meanwhile, largest investment bank J.P.Morgan's analysts said that they believe bitcoin is the worst tool to protect against falling stock prices. According to the bank, the current value of the cryptocurrency significantly exceeds its fair value. Experts believe that large investments in bitcoin increase its correlation with cyclical assets, which reduces its attractiveness as a means of diversification. A characteristic feature of "cyclical assets" is that they are actively invested in when the economy is doing well, but when problems arise, they are the first to get rid of. No one calls Bitcoin a "cyclical asset." It is clearly not bought in large quantities during the prosperity of the world economy. However, the very definition of "cyclicity" is the best fit for the cue ball. As soon as the big players start to get rid of the cue ball (due to its instability and lack of confirmation, this will happen sooner or later), other investors and traders will also start selling it. J.P.Morgan analysts also said that they do not consider bitcoin as "digital gold." In order for the capitalization of bitcoin to match the total investment in gold by the private sector, its price must rise to at least $146,000 per coin.

Thus, our point of view remains unchanged. Like other cryptocurrencies, bitcoin remains an excellent tool for earning money, and the whole world understands this now. While the cryptocurrency market is growing, this opportunity should be used to make a profit. The main thing that should not be forgotten in cryptocurrency trading is to always set a Stop Loss. No one knows when the "sharks" will start getting rid of bitcoin, so in order to avoid serious losses, you should always be insured with restrictive orders. In the meantime, the bitcoin exchange rate is targeted at $60,000 per coin, and at $100,000 in the future.