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Bitcoin [BTC]-specific positive catalysts since February are the reasons for its massive surge, suggests Travis Kling

Priya

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Bitcoin [BTC]-specific positive catalyst since February is the reason for its massive surge, suggests Travis Kling
Source: Unsplash

Travis Kling, Chief Investment Officer at Ikigai Asset Management, spoke about Bitcoin’s surge in an interview with Oliver Renick for TD Ameritrade Network. During the interview, Travis Kling listed out the reasons behind the massive price surge.

Bitcoin, the largest cryptocurrency by market cap, recorded a massive high, with the coin reaching its highest point since August 2018. According to CoinMarketCap, Bitcoin was trading at $8056.68 with a market cap of $142 billion, at press time. The 24-hour trading volume of the coin was around $34 billion and the coin witnessed a significant rise of over 12 percent over the last 24 hours, at press time.

On the rise from $6000 to over $8000 within a matter of days, Kling said that there have been several Bitcoin-specific positive catalysts since February 2019. These included announcements such as the JP Morgan Coin, Facebook Coin, a report by Cambridge Associates suggesting that institutional investors had to look at this investment class, and Jack Dorsey’s bullish sentiment towards the coin.



He went on to state,

“[…] TD Ameritrade, for example, they are preparing to give their customers the ability to buy Bitcoin on the TD Ameritrade platform. eTrade is doing something similar, Fidelity is on-boarding their first institutional clients for their Bitcoin custody product right now. You’ve got Bakkt coming at the end of the year, Nasdaq coming […]”

Kling further added that there was news surrounding monetary and fiscal policies with central banks and governments globally. This in turn, has made it “much more attractive to own an insurance policy against irresponsibility” from these bankers and governments.

“So, specifically for the Bakkt announcement, they haven’t launched their product yet and […] there’s a good chance that that product is going to be sort of about a year after when they initially said it was going to come down the pipe; as opposed to Fidelity and TD Ameritrade and eTrade, which kind of real time like right now positive catalyst.”





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Priya is a full-time member of the reporting team at AMBCrypto. She is a finance major with one year of writing experience. She has not held any value in Bitcoin or other currencies.

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JP Morgan: Big banks stand corrected as Bitcoin rally past intrinsic value; admits current surge mirrors 2017 rise

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JP Morgan: Big bank stands corrected at Bitcoin rally past intrinsic value; admits current surge mirrors 2017 rise
Source: Pixabay

Big banks are riding a FOMO wave as the Bitcoin bull-run is just beginning. Spearheaded by the changing colors of JP Morgan, which recently forayed into the digital assets world, the banking elite is now suggesting that their initial stance on Bitcoin and the larger cryptocurrency world might have been off.

A recent chart by JP Morgan shows the current BTC price veer upwards chiding the “intrinsic value” the big bank placed on the virtual currency.

Based on the article by Bloomberg, the price of the coin would reverse towards the end of December 2018 and then make marginal gains until May 2019, all under the $5,000 mark. In reality, the BTC price, after dropping to “rock bottom” at just above $3,100 in early December 2018, edged upwards.

Several spurts of growth were seen in early January and February, prior to a massive April ascendance. On April 2, Bitcoin did away with the bank’s value mode and amassed a daily gain of over 15 percent, fuelling its current rise. Breaking the $5,000 ceiling in the process, which was pegged to remain intact well into May 2019, the king coin is now almost $3,000 ahead of the mark and is not looking to stop.

Source: Bloomberg

It should be noted that JP Morgan’s “intrinsic value” is calculated on the basis of the marginal cost of production, electricity prices, and hash rates. This model does not take into account, at least on absolute terms, the anticipatory effect of the 2020 halving, which, according to a slew of analysts is the behind the price rise.

Nikolaos Panigirtzoglou, the MD in the Global Market Strategy team at JP Morgan stated that Bitcoin breaking through its “intrinsic value” showed signs of mirroring its 2017 bull run. He evidenced this move by comparing the pre-December 2017 slump to the one seen prior to the current bullish swing.

The analyst added:

“Over the past few days, the actual price has moved sharply over marginal cost. This divergence between actual and intrinsic values carries some echoes of the spike higher in late 2017, and at the time this divergence was resolved mostly by a reduction in actual prices.”

With the analyst admitting that the imparting of an “intrinsic or fair value” to a cryptocurrency, much less a volatile one like Bitcoin, is a “challenging” ordeal, a mere JP Morgan acknowledgement of a Bitcoin bull-run is a remarkable sign for the digital assets industry, especially given the bank’s and its CEO Jamie Dimon’s Bitcoin-bashing in the past.

Mati Greenspan, senior market analyst at eToro attested to the same, adding a key point that JP Morgan failed to take into account in their calculation. He stated:



“Great to see JPM finally admitting that Bitcoin has intrinsic value.
Now wait till they understand that miners who run a surplus tend to begin hording.”

Despite Bitcoin slumping at press time, recording a 1.23 percent decline against the dollar, the prospects look positive. After recording a massive gain on 19 May, briefly surging past $8,000 for the second time in a week, Bitcoin created a High-Low [HL] at $7,100, which many analysts look at with glee.

This HL immediately following last week’s pull-back caused due to post-Consensus bears, a Bitstamp sell-order and market correction showed the king coin’s bullish persistence and can even be a foundation for a $9,000 ascendance, defying any “intrinsic value” expectations.





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