Analysts from the Wall Street giant JP Morgan predicts that Bitcoin(BTC) could fall below $1,260 and banks will not reap benefits from the blockchain technology for at least three to five years, as reported by Reuters on Jan. 24.
According to the Reuters report, JP Morgan’s analysts think that crypto hasn’t yet proven its true value and that they can only do so in a hypothetical “dystopian” event, where investors would have lost their faith in major traditional assets such as gold and the U.S. dollar. The analysts stated in a report:
“Even in extreme scenarios such as a recession or financial crises, there are more liquid and less-complicated instruments for transacting, investing and hedging [than cryptocurrencies].”
The major global investment bank further elaborated that over the past six months, the institutional involvement in the crypto market has slowed, with individual traders making up the majority of the market. The report claims that using crypto for payments will remain “challenged,” citing that they could not find any major retailers that accepted crypto in 2018.
Bitcoin price to sink
JP Morgan’s analysts also suggest that, if the current bear continues, BTC will likely experience a drop to around $2,400, with the lower end as low as $1,260. At the time of writing the token was trading at $3,595, down around 1.7 over the past week, according to data from CoinMarketCap.
On one hand, the analysts believe that the distributed ledger technology (DLT) has the potential to change the global market by cutting costs for global banks and by digitizing various complex processes. Though, it was also forecasted that the blockchain technology will take at least three to five years more before making any real impact over the banking sector.
Jamie Dimon, the CEO of JPMorgan and a vocal critic of cryptocurrencies especially Bitcoin, have had called the token a “fraud” in September 2017. A little while later he even went to call cryptocurrency a Scam.