Bitcoin (CCC:BTC-USD) price predictions are only as good as the markets consider them to be. For investing powerhouse JPMorgan Chase, however, a wait-and-see philosophy seems to be at play amidst uncertain valuations. In its latest report to investors, the investment bank declared the alternative asset too volatile to merit its lofty price. The analysts assess the coin’s “fair value” is closer to $35,000, while conceding that its upside potential is, well, as good as gold.
In spite of its dramatic undervaluation of the crypto (it’s currently sitting at $62,021), JPMorgan suspects Bitcoin will only continue to outperform in 2022. Reasonably so.
Notorious crypto mining company Compass Mining has announced a plan to more than double its current mining capacity, Miami Mayor Francis Suarez is taking his next paycheck via Bitcoin, and crypto-exchange platform Coinbase (NASDAQ:COIN) recently announced BTC-USD as acceptable collateral for loans up to $1 million. This comes in addition to the fact that the currency is up more than 340% for the year.
Volatility Could Prove the Make-or-Break Factor for Any Bitcoin Price Prediction
Bitcoin is the talk of the town. JPMorgan acknowledges its potential to grow more than 11% over the next year, to a “reasonable” price target of $73,000. The analysts observe that the coin’s tendency for wild swings is one its major undoings. As such, even moderate growth expectation are largely predicated on a reduction in volatility over the next year.
With that in mind, the analysts seem cautiously bullish on the upper end of the coin’s so-called swing spectrum. Should its volatility decrease substantially, Bitcoin could prove a more inflation-resistant growth asset than even gold. According to JPM, it has the potential to go up to $146,000. It goes without saying that there is a pretty big gap between Bitcoin price predictions of $35,000 and $146,000. Perhaps then JPMorgan is just hedging its bets.
But for an asset as unpredictable as Bitcoin, especially amidst inflation concerns and a booming crypto market, the wide margins only reflect the coin’s largely uncertain future.
On the date of publication, Shrey Dua did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.