JPMorgan touts 2022 as year of ‘financial tokenization’

Fears of a cryptocurrency market crash are not slowing down investor interest in the vertical, according to JPMorgan equity research analyst Kenneth Worthington.

According to Worthington who updated clients on Friday, 2022 should see steady crypto adoption. The analyst makes two main predictions for the months ahead, arguing that 2022 will be the year of “financial tokenization”.

He also expects to see greater interoperability between individual blockchains, making more products on the various blockchains out there complementary and easy to use together.

Bitcoin (BTC), JPMorgan argues is “well-designed as a modern store of value and the strong design has contributed to the increased confidence in and value of Bitcoin”.

However, JPMorgan cautions that BTC is not the optimal storage of wealth when compared to other options, such as gold.

Worthington did remind that BTC’s volatility is another area of concern for many investors. BTC is still debated as a unit of account, a standard for deferred payments or a medium of exchange, although the currency often serves as all of the above.

JPMorgan’s observations reflect the position of Goldman Sachs who expect that “hypothetically, if Bitcoin’s share of the store value market were to rise to 50% over the next five years, its price would increase to just over $100,000 for a compound annualized return of 17%-18%”.

The prospect of having access to this market has pushed many billionaires to recommend investing a margin of one’s portfolio into the crypto market. If you are not quite sure what to do, you can just continue using cryptocurrencies as a form of entertainment plain and simple.

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Updated: 01/10/2022 — 18:00