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Bitcoin News Today: Bitcoin's Gold-Like Stability Sparks $126K Rally Prediction

Bitcoin News Today: Bitcoin's Gold-Like Stability Sparks $126K Rally Prediction

ainvest2025/08/29 17:33
By:Coin World

- JP Morgan analysts predict Bitcoin could reach $126,000 by year-end due to record-low BTC/Gold volatility (2.0), aligning it closer to gold in risk-adjusted terms. - Bitcoin's volatility dropped to 30% in August 2025, driven by institutional adoption (6% of supply held by treasuries) and ETF inflows totaling $2.5B in August alone. - Current price ($111,950) trades at a 13% discount to JP Morgan's fair value estimate, with on-chain metrics like MVRV suggesting consolidation ahead of potential breakout. -

Bitcoin could rally toward $126,000 by the end of the year as the volatility of the BTC/Gold ratio has hit a record low, according to a recent analysis by JP Morgan. The firm's analysts, led by Managing Director Nikolaos Panigirtzoglou, argue that Bitcoin is currently undervalued against gold due to its declining volatility. The BTC/Gold volatility ratio has fallen to 2.0, the lowest level ever recorded, suggesting that Bitcoin now consumes twice as much risk capital as gold in client portfolios. This dynamic, analysts argue, places the asset in closer alignment with gold in risk-adjusted terms, making it more attractive for institutional investors [1].

Bitcoin’s volatility has declined significantly in 2025, falling from nearly 60% at the beginning of the year to a record low of around 30% by August. Analysts attribute this to the increasing institutionalization of the asset, with corporate treasuries now holding over 6% of the total Bitcoin supply. This trend is reminiscent of the post-2008 bond market, where central bank interventions reduced asset swings by locking assets into balance sheets. Passive inflows have also increased, fueled by Bitcoin's inclusion in key equity indices and custody strategies by major firms [1].

The growing institutional interest in Bitcoin is further supported by recent market developments, including a surge in inflows into exchange-traded funds (ETFs) and crypto treasuries. These inflows have reached $2.5 billion in August 2025 alone, signaling a broader acceptance of Bitcoin as a legitimate asset class within traditional finance. Analysts believe that this growing institutional presence may help cushion potential price declines and accelerate recoveries [1].

Despite the bullish signals, Bitcoin’s price remains below its fair value, according to JP Morgan's calculations. The firm estimates that Bitcoin needs to rise by approximately 13% to reach $126,000, which would bring its market capitalization to $2.2 trillion—a level that would align it more closely with the $5 trillion private gold market. Current price levels, around $111,950, indicate that Bitcoin is trading at a significant discount to this benchmark. The analysts believe this discrepancy creates a compelling investment opportunity, especially as volatility continues to decline and risk-adjusted returns improve [1].

On-chain data also supports the notion that Bitcoin is undervalued. Metrics such as the True MVRV (Market Value to Realized Value) valuation have reached levels consistent with historical local bottoms observed in May and June 2025. These indicators suggest that the market is consolidating gains and preparing for a potential breakout, provided that macroeconomic conditions remain favorable. For example, if the July PCE inflation data comes in cooler than expected, it could boost expectations for a Federal Reserve rate cut and support a BTC price recovery. Conversely, hotter-than-expected data could trigger bearish sentiment in the short term [1].

However, Bitcoin’s path to $126,000 is not without challenges. The asset remains in a consolidation phase, trading near the $110,000 level. While bulls have managed to hold above this key support, momentum remains weak, and attempts to break higher have so far failed. Analysts warn that a deeper correction could occur if buyers do not step in with stronger conviction. The market is currently in a balancing phase, where short-term profit-taking is being absorbed by the longer-term growth trend. A decisive move either higher or lower in the coming weeks will likely determine the next phase of Bitcoin's trajectory [2].

Source:

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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