Crypto investors should be holding ethereum rather than bitcoin as interest rates rise, JPMorgan said, because the blockchain has more uses such as powering decentralized finance and non-fungible tokens.
JPMorgan analysts, led by market strategist Nikolaos Panigirtzoglou, said in a recent report that rising interest rates could pose a problem for bitcoin, just as they traditionally do for gold.
Bitcoin has boomed in a world of ultra-low interest rates and massive bond-buying, which have flooded markets with cash and spurred concerns about overheating. Many see bitcoin as “digital gold” and a hedge against inflation.
But central banks around the world are cutting back their support for economies in an effort to cool strong inflation. That means interest rates and bond yields are poised to start rising.