Experts at JPMorgan, the largest US bank, believe that the main reason for the rise in bitcoin prices in recent days has been the return of institutional investors to the digital currency market.
to the Report Bitcoin cryptocurrency has seen one of its best price periods in the last seven days and during this recent uptrend was able to reach its price of $ 55,000.
The traditional bank said in a research note that institutional investors are returning to the bitcoin market, while many analysts have not yet hinted at the reasons for Bitcoin’s recent uptrend.
New institutional investors have flocked to the bitcoin market to escape inflation, according to JPMurgan. The bank explains that in the past, investors may have chosen gold to counter inflation, yet they now feel that bitcoin is more effective against inflation.
The GPSMorgan report states:
Institutional investors seem to want to reinvest in bitcoin. Maybe they think bitcoin is a better tool to deal with inflation than gold.
JPMurgan explains that this year alone, more than $ 10 billion has been withdrawn from tradable funds on the Gold Exchange, while in the same period, more than $ 20 billion in cash has flowed into mutual funds in Bitcoin.
Compared to other digital currencies, this inflow has had a positive effect on bitcoin dominance. On the other hand, increasing Bitcoin’s share of the digital currency market can be considered a good development, as this position could mean more institutional investors in the Bitcoin market, compared to smaller digital currencies.
Another reason for the rise in bitcoin prices is that US officials have reassured the digital currency community that they do not want to ban the industry, says JPMurgan. Previously, in the digital currency space, there were fears that the United States would follow in China’s footsteps and ban digital currency trading.
Gary Gensler, chairman of the US Securities and Exchange Commission, recently said the United States was not seeking a ban on digital currencies.
GPSMorgan Bank concluded that the recent growth of the Lightning network and second-tier payment strategies that helped accept bitcoin in El Salvador have also contributed to the rise in the price of this digital currency.