Yesterday, reports emerged that JPMorgan released a note which said that it believed the fair market value of Bitcoin was 28% higher than it is trading. In particular, the note said it saw “significant upside from here” in Bitcoin and other cryptocurrencies, particularly after the sell-off. It also noted that digital assets have replaced real estate as its preferred “alternative asset.” The paper notes that $38,000 is a fair price for Bitcoin.
“One of the things that the authors noted in the report was that the recent sell-off harmed digital assets more than other alternative assets. That means that there’s more room for cryptocurrencies to bounce back. This report validates what so many of us have been continuing to say: this recent sell-off was the result of external factors, including raging inflation, a war in Eastern Europe, the resurgence of Covid, and a labor and material shortage, among other things,” said Richard Gardner, CEO of Modulus, a US-based developer of ultra-high-performance trading and surveillance technology that powers global equities, derivatives, and digital asset exchanges.
“The past month’s crypto market correction looks more like capitulation relative to last January/February and going forward we see upside for bitcoin and crypto markets more generally,” the bank’s strategists, including Nikolaos Panigirtzoglou, wrote in the note. “We thus replace real estate with digital assets as our preferred alternative asset class along with hedge funds.”
“The past few months have been plagued with external factors that have hit cryptocurrencies hard. But, to be fair, they have decimated traditional markets, as well. There’s uncertainty with the Fed and monetary policy, and investor confidence is way down. Those are things that are completely unrelated to the long-term value of cryptocurrencies, so investors are now able to buy into the market at a reduced price,” said Gardner.
“If you look at the venture capitalists, they aren’t ditching blockchain technologies or cryptocurrency. There’s real, long-term value in digital assets. Evaluate digital assets on the technical indicators behind them rather than the macroeconomics which surround them, and you’ll find yourself in a good position in the long-term,” Gardner opined.
Modulus is known throughout the financial technology segment as a leader in the development of ultra-high frequency trading systems and blockchain technologies. Modulus has provided its exchange solution to some of the industry’s most profitable digital asset exchanges, including a well-known multi-billion-dollar cryptocurrency exchange. Over the past twenty years, the company has built technology for the world’s most notable institutions, with a client list which includes NASA, NASDAQ, Goldman Sachs, Merrill Lynch, JP Morgan Chase, Bank of America, Barclays, Siemens, Shell, Yahoo!, Microsoft, Cornell University, and the University of Chicago.
“I think, as we begin to see the regulatory bill come out of Congress, there will begin to be more certainty around the industry. Many will begin looking at cryptocurrency derivatives as a way to balance the risk associated with holding individual cryptocurrencies, too. There is continued innovation in the digital assets space, so we will continue to see investor interest,” noted Gardner.
