Bitcoin's Upside Potential
JPMorgan, a prominent US bank, has forecasted that Bitcoin could surge to as high as $170,000 within the next six to twelve months, despite the current bear market conditions.
This prediction is based on a valuation model developed by the bank's strategists, which adjusts for volatility and draws a comparison between Bitcoin and gold.
In a recent note, JPMorgan analysts stated, "Our volatility-adjusted Bitcoin-gold comparison shows the theoretical Bitcoin price approaching $170,000, suggesting strong upside potential for the next 6-12 months."
Factors Influencing Bitcoin's Price
Bitcoin has experienced a significant correction in recent months. This downturn is attributed to a strengthening risk-off trend in financial markets, ongoing uncertainty regarding the interest rate path beyond 2026, and concerns surrounding MicroStrategy, a company heavily invested in Bitcoin.
Trading at approximately $92,593, Bitcoin has seen a decline since the start of the year, falling 26% from its peak above $126,000.
Despite these short-term challenges, JPMorgan suggests that Bitcoin may exhibit long-term pricing behavior that more closely resembles gold. This potential correlation was particularly noticeable in April, when substantial inflows into Bitcoin coincided with a sell-off in US stock markets, exacerbated by tariff concerns.
Impact of MSCI Decision on MicroStrategy and Bitcoin
MSCI, a global index provider, is currently considering a rule change that could lead to the exclusion of companies with a digital asset weighting exceeding 50% from its indices. A final decision is expected on January 15.
If this proposed rule is implemented, MicroStrategy, a company known for its significant Bitcoin holdings, would likely be removed from the MSCI USA and MSCI Global indexes. JPMorgan estimates that this exclusion could generate approximately $2.8 billion in selling pressure on MicroStrategy's shares.
However, JPMorgan also highlighted a potential positive outcome:
"If the MSCI decision is positive, both MicroStrategy and Bitcoin will likely return strongly to pre-October 10 levels."