What Happened: Strategists at JPMorgan Chase & Co. (NYSE:
JPM) have endorsed a one percent allocation to Bitcoin in a note to clients.
Analysts from the multinational investment bank have suggested that such an allocation could serve as a hedge against fluctuations in traditional asset classes like equities, bonds, and commodities.
According to Bloomberg, JPM strategists Joyce Chang and Amy Ho stated, “In a multi-asset portfolio, investors can likely add up to 1% of their allocation to cryptocurrencies in order to achieve any efficiency gain in the overall risk-adjusted returns of the portfolio.”
Why It Matters: JPMorgan is one of the few Wall Street banks that have predicted a shift towards crypto from more traditional asset classes last year.
Earlier this year, another JPMorgan strategist Nikolaos Panigirtzoglou said that the digital asset could be worth as much as $146,000. According to him, at this price point, Bitcoin’s market value would be on par with the market value of gold.
