The banking giant JPMorgan, which stores estimated assets of around $316 billion, views the potential for growth of Bitcoin as “considerable”. The news about the optimistic stance of the banking institution comes days after it became clear payment giant PayPal is moving rapidly to allow Bitcoin payments on its platform.
Bitcoin as the new gold
A document designated for internal use in the bank has been obtained by Business Insider. It describes the first cryptocurrency as a potent competitor of gold. It reads:
“The long-term potential of Bitcoin is considerable if it starts competing more aggressively with gold as an “alternative” asset, given that millennials` role on the investment market grows over the coming years”.
The note highlights three major reasons for the long-term upside of Bitcoin in its antagonistic struggle with gold.
Firstly, BTC must rise around 10 times to challenge the investment capitalization of gold – which is arguably not that much considering the other factors in play. Second, cryptocurrencies offer high utility in their usage. And finally, Bitcoin will appeal to the future dominant force on the investment market – namely millennials. The transfer of gold demands physical delivery, which becomes ever more challenging and slower in contrast to crypto. The banks analysts explain further:
“Cryptocurrencies derive their value because they serve not merely as stores of assets, but also because of their usage as a means of payment. The more venues and economic agents start accepting cryptocurrencies as a means of payment, the higher their utility and value becomes.”
The incoming “tsunami” of investment
As we recently reported, so far only 7% of Americans have ever invested in Bitcoin. Furthermore, in recent weeks institutional interest in the first cryptocurrency has been steadily growing. Publicly traded companies, payment giants, and investment banks have been actively recognizing the untapped potential of Bitcoin.
