Investment bank JPMorgan has calculated Bitcoin’s fair value at $38,000. This figure is 12% less than the actual price at the time, indicating overvaluation and suggesting a possible price drop to come.
On-chain analysis conducted by Glassnode shows an undervaluation in relation to the 200-day moving average. While contradictory to JPMorgan’s assessment, historical occurrences of this pattern support price drawdowns and capitulation events.
In short, despite opposing views on fair value assessment, both entities suggest a possible bearish outlook.
How did JPMorgan come up with its assessment?
JPMorgan strategists headed by Nikolaos Panigirtzoglou worked out Bitcoin’s fair value based on its volatility against gold.
Detailed calculations were not included in the Bloomberg piece. However, they state that the $38,000 fair value figure is derived from Bitcoin being approximately four times as volatile as gold.
Typically, when an asset is trading above its fair value, it will likely
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