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JPMorgan Calls Bitcoin ‘a Resilient Asset’ for Surviving Global Meltdown

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JPMorgan - Investors King

JPMorgan Says Bitcoin is a Resilient Asset for Surviving March Meltdown

JPMorgan, one of the world’s leading investment banks, has described the world’s most dominant cryptocurrency Bitcoin as resilient for surviving March’s global financial meltdown.

In a note sent to clients on June 11, JPMorgan analysts said Bitcoin has shifted from an uncorrelated asset to one whose price now closely tracks traditional stocks.

“Though correlations were modest and mostly mean-reverting around zero for much of the past couple of years, in recent months they have moved sharply higher in some cases (equities) and lower in others (U.S. dollar, gold),” wrote the analysts led by Joshua Younger.

This is largely due to what Investors King highlighted last week that institutional investors now dictate price movement in the crypto market, not the usual retail investors.

The analysts, who usually cover traditional assets like bonds, highlighted Bitcoin’s success against traditional assets in March on a volatility-adjusted basis. They noted that the liquidity on top Bitcoin exchange platforms was surprisingly more resilient than gold, U.S. Treasury bonds and other traditional assets.

Similarly, they said while Bitcoin liquidity drop during the peak of the crisis, it rebounded faster than other assets. They said this “suggests that bitcoin saw among the most severe drops in liquidity around the peak of the crisis in March, but that disruption was cured much faster than other asset classes.”

“At this point, bitcoin market depth is above its 1-year trailing average, while liquidity in more traditional asset classes has yet to recover.”

This is coming after Goldman Sachs rubbish the dominant cryptocurrency in May, saying it is not an investment vehicle.

“Cryptocurrencies including bitcoin are not appropriate as an asset class,” stated Goldman Sachs to clients in May.

While JPMorgan did not disagree with Goldman Sachs’s position, the analysts said at least one thing is certain, Bitcoin is a resilient asset, if not a stable or useful currency.

They also agreed that the coin did not live up to its reputation as a port in a storm despite its resilient market structure during the peak of the global pandemic in March.

“There is little evidence that bitcoin and others served as a safe haven (i.e., ‘digital gold’)—rather, its value appears to have been highly correlated with risky assets like equities,” the report concluded. “This all likely points to the continued survival of the asset class, but likely still more as a vehicle for speculation than as a medium of exchange or store of value.”

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Ethereum

ETH Surged Above $4K With Over $477B Market cap.

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The Ethereum price surged and crossed the $4,000 milestone. ETH is trading at $4,132 (as at the time of publishing), bringing its total market cap to more than $477 billion.

Ether, the second biggest cryptocurrency, has grown over 2,000 percent in the last year.

On May 10, 2020, one Ether token was worth $180. a year later, the crypto coin hits over $4,000 for the first time, a rise of over 2,100 percent. Though Dogecoin is sucking up most of the world’s cryptocurrency attention, it’s been a huge May for Ethereum already, as this new milestone comes just a week since the cryptocurrency coin hit $3,000 for the first time.

Ether is a cryptocurrency minted on the Ethereum blockchain. Bitcoin, the most known currency, is built on its own, separate blockchain. But while Bitcoin is more like gold, principally used as a speculative asset, Ether is used by cryptocurrency traders to buy and sell “altcoins”, such as Dogecoin. NFTs, tokens that authenticate ownership of a digital product, are notably bought and sold using Ether, not Bitcoin.

The Ethereum blockchain was founded in 2013 by Canadian-Russian programmer Vitalik Buterin when he was just 19 years old. Buterin has over 333,000 Ether tokens — it’s possible to see other traders’ portfolios if you have their wallet address — which at the current price values his holdings at over $1.36 billion.

The cryptocurrency has been growing rapidly over the past year, mostly over anticipation for its relaunch as Ether 2.0, but this latest rally is tied to the news last week that the European Investment Bank issued $120 million in bonds using Ethereum blockchain.

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Cryptocurrency

Ripple Sees Another Victory As Court Orders SEC to Give Ripple Internal Documents on XRP, Bitcoin, Ether

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Ripple

Ripple scores another in legal wrangling over SEC lawsuit as SEC now must disclose its confidential internal communications over XRP, Bitcoin and Ethereum.

The SEC must produce communications with third parties, including external agencies and market participants, subject to a privilege assertion, according to Netburn’s five-paragraph ruling.

“Intra-agency memoranda or formal position papers discussing Bitcoin, Ethereum, and XRP must be searched for and produced subject to a privilege assertion,” said the judge, adding that “Examples of such documents include Division reports, final reports of internal working groups, or formal position papers submitted to the Commissioners.”

However, she added, informal intra-agency communications such as emails would not need to be produced.

The judge also ruled that although such information may ultimately be privileged — meaning exempt from disclosure — associated information such as meeting dates and names of participants could be relevant and is discoverable. Any documents withheld on the basis of privilege must be identified on a privilege log, according to the ruling. The order also directed Ripple and the SEC to continue to meet and confer on the remaining issues in their letters.

“The Judge tried to bridge the gap by giving slightly more detail into the types of memoranda and position papers that need to be disclosed,” Jesse Hynes, general counsel at Gala Games

“It’s clear she still wants Ripple and the SEC to figure it out amongst themselves, which hasn’t had great success to date. I wouldn’t be surprised if this comes before the court again. This order, however, is definitely a win for Ripple.” Hynes added.

Why the ruling is significant
Last December, the SEC filed a lawsuit against Ripple alleging that its sale of XRP was an unregistered securities offering worth over $1.38 billion. The SEC also named Ripple’s executive chairman Chris Larsen and CEO Brad Garlinghouse as co-defendants for allegedly aiding and abetting Ripple’s violations.

At the heart of the lawsuit is whether transactions involving XRP constitute “investment contracts” and therefore securities subject to registration under Section 5 of the Securities Act of 1933.

Access to the SEC’s internal communications has been one of the most heated areas of contention between Ripple and the SEC in the litigation. Judge Netburn had, at an earlier discovery conference on April 6, ruled to grant “in large part” Ripple’s motion to compel the SEC to produce documents reflecting SEC’s prior statements and communications with third parties as well as internal documents discussing whether XRP, Bitcoin or Ether are considered securities.

However, Ripple and the SEC have been unable to agree on the documents to be disclosed under the order, with the SEC arguing that Ripple’s requests for internal documents were improper and irrelevant.

But the judge is now disagreeing with the SEC’s position.

“The discovery related to Bitcoin and Ether is relevant,” said Netburn at the April 6 hearing. “I think it is relevant to the Court’s eventual analysis with respect to the Howey factors, but I also think it is relevant as to the objective review of defendants’ understanding in thinking about the aiding and abetting charge or aiding and abetting count. I also think it is relevant to the fair notice defense that Ripple is raising.”

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Cryptocurrency

Ahead of Elon Musk SNL Skit Dogecoin Sets Another All-Time High Within 3 Days 

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Dogecoin

Dogecoin (DOGE) has hit another all-time high, just 21 hours before Elon Musk is anticipated to air a skit about the coin on Saturday Night Live.

Dogecoin hit $0.73 at 5:45 am WAT before retreating to its current price, $0.71, according to data from Binance. Saturday Night Live, the comedy show that the Tesla and SpaceX CEO is hosting, airs at 8.30 pm Pacific Time (PT), or 4.30 am Sunday WAT.

The meme coin, created in 2013 to mock Bitcoin (BTC) spinoffs, almost surpassed the market cap of the third-largest cryptocurrency, Binance Coin (BNB). At $0.73, Dogecoin’s market cap reached $95.3 billion, just 1.6 percent less than the market cap of BNB.

“For everyone in the #binance ecosystem, don’t get distracted, just keep #buidling,” tweeted Changpeng Zhao, Binance’s CEO.

Speculators believe that the SNL skit could introduce Dogecoin to a whole new audience. The hope is that viewers will become so entranced by the skit that they’ll buy Dogecoin, pushing up the price.

The skit has already helped Dogecoin. When Musk tweeted, “The Dogefather. SNL May 8,” on April 28, the price rose 15 percent to $0.32.

Dogecoin set it’s previous all-time high $0.69 a lewd number pushed by the Dogecoin Army, a group of die-hard fans on May 5.

Speculators hope that Musk’s skit will at least push the price up to $1 by Monday.

Gemini and eToro listed the dogecoin earlier this week, and Robinhood’s crypto trading service went offline as Dogecoin soared.

Dogecoin is an extremely volatile cryptocurrency with a track record of pumps and dumps. It’s risen from under $0.01 in January to today’s all-time high of $0.73 with a number of spectacular rises and crashes.

Should the coin crash shortly after Musk’s skit, investors may no longer find the coin so funny.

Coinbase, the US’s largest cryptocurrency exchange, has still not listed it.

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