Excessive Volatility Hindering Further Mainstream Adoption of Bitcoin, JPMorgan Says

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Bitcoin ( $77,609.00 ) ’s biggest challenge is its volatility and the boom and bust cycles that hinder further institutional adoption, JPMorgan said in a research report.

The bank’s fair value estimate for Bitcoin ( $77,609.00 ) – based on the volatility ratio of Bitcoin ( $77,609.00 ) to gold – fell to around four times, or $38,000, analysts led by Nikolaos Panigirtzoglou wrote in the note published last week.
JPMorgan said its previous forecast of the Bitcoin ( $77,609.00 ) to gold ratio falling to around two times now seems unrealistic. The bank sees significant headwinds for both Bitcoin ( $77,609.00 ) and ethereum going forward.
The challenge for ethereum is different to that for bitcoin, as it derives most of its value as a “decentralized application currency rather than a form of digital gold,” it said.
Ethereum ( $2,136.62 ) is facing challenges due to declining market share in the decentralized finance (DeFi) and non-fungible-token (NFTs) sector, the bank said. During this month’s correction, ether failed to recapture market share from its main competitors with ether prices falling by a similar magnitude compared to smaller altcoins, the bank added.
Similar to last May, unwinding of leveraged futures contracts played a significant role in the crypto market correction in recent weeks, the bank said, but this month’s unwinding of positions seems less severe.
Bitcoin ( $77,609.00 ) was trading around $37,244 as of publication time.