Stocks of companies exposed to the cryptocurrency market stay high as analysts at the world's top bank, JPMorgan Chase & Co. JPM, suggest that Bitcoin BTC/USD is headed lower.
What Happened: According to JPMorgan's note written by analyst Nikolaos Panigirtzoglou, a medium-term fair value for Bitcoin now stands between $24,000 and $36,000, and weekend institutional demand is likely to bring its value below $30,000.
“The fair value for Bitcoin based on a volatility ratio of Bitcoin to gold of around x4 would be 1/4th of $145k or $36k. The fair value for Bitcoin based on the current volatility ratio of Bitcoin to gold of around x6 would be 1/6th of $145k or $24k. We thus see a fair value range of $24k to $36k over the medium term," Panigirtzoglou write in the note.
The analyst said that JPMorgan still sees a $145,000 price mark as a long-term “theoretical target” for BTC’s price, but admitted that this would only happen if “assuming a convergence of Bitcoin volatility to that of gold and an equalization of bitcoin allocations to that of gold in investor portfolios.”
This scenario, he wrote, "is unlikely" to happen "in the foreseeable future."
He concluded that Bitcoin would still need to fall "to the $26k level before longer-term momentum would signal capitulation.”
Price Action: While according to CoinMarketCap data Bitcoin's price grew by nearly 6.4% from its 24-hour low of $35,787 to a high of $38,231.
The price settled at $37,853 at press time, and it was still over 68% down from its mid-April high of $64,243 and at $37,857 as of press time.
Similarly, CoinMarketCap indicates that Ethereum saw its price increased by nearly 10.5% from a 24-hour low of $2,533 to a high of $2,798 and currently is worth $2,772, down 55% from its mid-May high of $4,297.
Crypto Stocks Price Action: Despite all those doubts over the near future performance of Bitcoin — which has historically been a near-perfect predictor of the performance of the overall crypto market — hope of long-term performance is seemingly protecting crypto-related stocks from downtrend pressure.
United States-based crypto exchange Coinbase Inc. COIN is up 2.7% over the last 24 hours and worth $241,50 per stock, while crypto mining hardware producer Caanan Inc. CAN stays at $10.19 after seeing nearly no price movement compared to its usual volatility and is down 0,68% today.
Caanan's competitor Ebang International Holdings Inc EBON fared worse, standing at $3.3 after its price falling by 3,27% as United States-based mining farm operator Riot Blockchain Inc. RIOT stands at $30,17 and is up by 3,22%.
Canadian crypto mining firm Hut 8 Mining Corp. HUT is also seeing a good day at CAD$5,06 ($4,20), being up 4,55%, while crypto financial services firm Galaxy Digital Holdings Ltd GLXY saw nearly no price action and lost 0,68% and stands at CAD$20,81 ($17,28).
© 2023 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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