JPMorgan Chase provides some much-needed support to cryptocurrency investors this week.
This comes as cryptocurrencies have suffered from a variety of macroeconomic problems, ranging from inflation to the Ukraine conflict, prompting a sell-off in risky assets.
Since January, the crypto market has lost almost $1 trillion in value, with leading digital assets Bitcoin and Ether losing 38% and 48% year to date respectively, according to Fortune.
Moreover, the collapse of the stablecoin TerraUSD earlier this month has further contributed to the industry's skepticism.
However, Bitcoin, the world's leading digital asset, has "significant upside potential," according to the investment bank's strategists, led by Nikolaos Panigirtzoglou, in a Wednesday note.
The strategists kept their $38,000 Bitcoin Price Predictions, which indicates a potential 29% increase from the Bitcoin price trading level of $29,430 on Wednesday morning.
They wrote: "The past month's crypto market correction looks more like capitulation relative to last January/February and going forward, we see upside for Bitcoin and crypto markets more generally,"
As mortgage rates rise, JPMorgan sees digital assets and hedge funds as its "preferred" alternative asset classes, with real estate getting pushed to the sidelines.
However, citing persisting macroeconomic challenges, the investment bank's analysts downgraded alternative investments as a whole to "underweight" from "overweight."
Since last year, when it provided its wealth management clients access to six crypto funds, including the Grayscale Bitcoin Trust, JPMorgan has made moves to become more involved in the crypto market.
In February, the bank also announced a "strategic investment" in TRM Labs, a blockchain analysis company.
On Wednesday, JPMorgan's strategists also struck a more upbeat tone, arguing that despite the recent crypto sell-off, there has been no evidence that venture capital (VC) funding in the industry is waning.
To their point, also on Wednesday, the VC firm Andreessen Horowitz announced that it had raised $4.5 billion for its fourth crypto fund in hopes of taking advantage of bargains in the crypto bear market.
Bitcoin Is Stable, Says Analyst
On Wednesday, FXStreet reported Bitcoin disregarded the bullish dynamics of US market indices, limiting the amplitude of its fluctuations even more. Since the launch of active trading in New York, the first cryptocurrency has been moving between $29.5 and $30.0K.
"We caution that this reduction in volatility risks turning into an explosion in the near term, potentially setting off momentum for a few days or weeks," Alexander Kuptsikevich, an analyst at FxPro Financial Services Limited.
The situation is more concerning outside of Bitcoin. As of present writing, CoinMarketCap reflected the entire capitalization of the crypto industry has dropped 1.6 percent in the last 24 hours to $1.25 trillion. The dominance index for Bitcoin has increased by 0.4 points to 45.1%.
Tesla Delivers Massive Solar Batteries to Texas Bitcoin Mining Facility
Meanwhile, Tesla has delivered four Megapacks to a massive new Bitcoin mining facility in Texas, which will be the first to use Tesla's solar and batteries, per Electrek.
The idea was unveiled last month as a collaboration between Tesla, Blockstream, and Jack Dorsey's Blocks (formerly Square).
The project aims to construct a new 30 Petahashes per second open-source Bitcoin mining facility that will be powered by a 3.8 MW solar farm and Tesla's 12 MWh Megapack system.
Blockstream generated $40 million for the project with a token that allows anyone to trade the token on Bitfinex to invest in the Bitcoin mining operation powered by Tesla Megapacks and solar.
Tesla's engagement in the initiative is noteworthy in light of the company's incorporation of cryptocurrencies in its operations.
Tesla spent $1.5 billion on Bitcoin in early 2021. The company began taking cryptocurrencies as payment for new vehicles afterward.
But the company took a step back with cryptocurrency by eliminating the Bitcoin payment option a few days later. The corporation expressed concern about the Bitcoin network's energy requirements.
