JPMorgan is not a Bitcoin indicator. But the American banking giant’s third-quarter earnings report is full of anecdotes that may influence the cryptocurrency’s future outlook – in one way or another.
BACKGROUND
THE THREE BITCOIN TAKEAWAYS
#1 LOAN DEFAULTS
For Bitcoin, it is good news. JPMorgan is telling the whole world that the worst for the US economy is behind. That should mean a continued upside run across the riskier assets as investors hunt for better yields away from cash and bond markets. Bitcoin has fared better under such fundamentals so far in 2020.
#2 STIMULUS PACKAGE
While most of that money now stands spent, the policymakers are discussing the second round of stimulus. Mr. Dimon believes that a “good, well-designed stimulus package will simply increase the chance” of getting “better outcomes.” He added that “there is so much uncertainty” around the deal that they cannot predict a “definite” outcome.
Bitcoin’s bullish bias is also at an impasse with the delay in the second stimulus deal.
JPMorgan’s relaxed stance showed that–deep inside–it expects a stimulus deal to protect it from loan defaults. It is the question of when.
#3 JPMORGAN WARNINGS
That should also pause or reverse the ongoing Bitcoin rally. When stocks come under pressure, investors attempt to dump their crypto holdings to generate cash, as they did in March 2020.
BTC/USD was trading at 11,403 at the time of this writing, up 58.48 percent on a year-to-date timeframe.