In this photographic illustration, the visual representations of the digital cryptocurrency Bitcoin are organized on January 4, 2021 in Katwijk, Netherlands.
Yuriko Nakao | Getty Images
Bitcoin soared on Wednesday to hit a new historic record, with the cryptocurrency continuing to trade wildly.
The price of bitcoin rose to more than $ 35,000 on Wednesday morning, according to data from Coin Metrics. Subsequently, it slightly reduced gains, being traded 1% higher than 34,275.
Bitcoin’s last all-time high came just days after falling more than 10% to $ 29,316. This followed a jump of more than 300% in 2020 to levels above $ 29,000.
On Monday, JPMorgan published a note with a bold long-term price target for bitcoin, claiming that the cryptocurrency could rise to $ 146,000, as it competes with gold as an “alternative” currency. The precious metal also made considerable gains in 2020, with spot gold increasing by around 25% in the year.
Anthony Scaramucci, founder and co-managing partner of SkyBridge Capital, also told CNBC’s “Capital Connection” on Wednesday that his company is “quite optimistic” in the bitcoin value reserve and sees it “replacing” gold.
Scaramucci, a former White House communications director, added that Congressional democratic control would be “great” for cryptocurrencies due to expectations of “tremendous” printing of money under a party-controlled federal government.
JPMorgan strategists, however, said that bitcoin will need to become substantially less volatile before it can match gold in terms of market value. The price of cryptocurrency is known to suffer large fluctuations.
The U.S. investment banking giant’s decision was notable, given CEO Jamie Dimon’s earlier comments on bitcoin. Dimon once called cryptocurrency “fraud”.
Meanwhile, PwC global cryto leader Henri Arslanian told CNBC’s “Street Signs Asia” on Monday that bitcoin’s recent rise to record levels was partly driven by the entry of larger institutional investors into the market.
Bitcoin bulls hailed the virtual currency as a hedge against gold-like inflation, in the face of unprecedented government stimulus aimed at fighting the coronavirus pandemic.
– Ryan Browne of CNBC, Saheli Roy Choudhury and Yen Nee Lee contributed to this report.