Strategists from American multinational investment bank, JPMorgan Chase have pointed out that the latest surge in the price of Bitcoin (BTC) is more likely driven by the acknowledgement of the role of BTC as a hedge against inflation.
The strategists, led by Nikolaos Panigirtzoglou discounted the likelihood that the hype around the launch of BITO, the ProShares-backed Bitcoin linked Exchange Traded Fund (ETF) was behind the rally which pushed BTC to a New All-Time High (ATH) at $66,952.
“By itself, the launch of BITO is unlikely to trigger a new phase of significantly more fresh capital entering Bitcoin,” the strategists wrote referring to the ProShares Bitcoin Strategy ETF.
“Instead, we believe the perception of Bitcoin as a better inflation hedge than gold is the main reason for the current upswing, triggering a shift away from gold ETFs into Bitcoin funds since September.”
According to the analysts, the hype around the ProShares ETF product may die down in about a week, and the fundamental that will sustain the upshoot in the price of the digital asset is its embrace as an inflation hedge.
After all, they claim that the switch from gold-backed ETFs into Bitcoin has, according to the strategists, helped support the bullish outlook for the premier digital currency as it looks to end the year trailing a completely new ATH.
While investors around the world, particularly those in countries like Canada and Brazil with active crypto ETFs have unique options to gain exposure to Bitcoin, the options available to American investors are also increasing today. Besides the launch of BITO which tracks Bitcoin Futures, investors can now also back the stocks of companies whose primary products revolve around BTC or the cryptocurrency ecosystem.
Bitcoin is currently seeing a mild retracement after hitting its ATH score. At the time of writing, the coin was changing hands at $62,894.75, down 4.80% in the past 24 hours.
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