- JPMorgan sets Bitcoin’s support price near $94K, citing rising mining costs.
- Analysts project Bitcoin could climb to $170K based on gold market parity.
- Bitcoin’s downside seen as limited after network difficulty raises production cost.
JPMorgan analysts said Bitcoin’s downside risk appears to be minimal at current levels, citing the cryptocurrency’s rising production cost as a key technical support.
In a note published Wednesday, the bank’s team led by Nikolaos Panigirtzoglou, managing director at JPMorgan, placed Bitcoin’s estimated support price around $94,000, suggesting the cryptocurrency has limited room to fall from its recent level of roughly $102,300.
Rising production costs set new support level
According to JPMorgan, the estimated cost to produce one bitcoin — often viewed as a proxy for the cryptocurrency’s “floor” price — has risen from about $92,000 to approximately $94,000.
This increase, the analysts said, is largely driven by a sharp rise in Bitcoin network difficulty, which measures how much computing power is required to mine new blocks.
As network difficulty climbs, miners must deploy more energy and hardware resources to maintain output, effectively increasing the marginal cost of producing new coins.
The analysts noted that Bitcoin’s price-to-production cost ratio now sits just above 1.0, placing it near the lower end of its historical range.
“The bitcoin production cost has empirically acted as a floor for bitcoin,” the analysts wrote, adding that “a $94,000 production cost implies very limited downside to the current bitcoin price.”
Historically, production costs have correlated closely with Bitcoin’s longer-term valuation trends, as mining profitability often influences both network participation and supply dynamics.
The current alignment, JPMorgan said, supports the view that downside risk is constrained unless broader market sentiment deteriorates further.
Upside scenario points to $170,000 target
While downside appears limited, JPMorgan reiterated its 6–12 month upside projection of about $170,000 for Bitcoin, based on a volatility-adjusted comparison to gold.
The analysts explained that Bitcoin currently consumes around 1.8 times more risk capital than gold, implying that its market capitalization could rise substantially to reach parity with gold’s level of private-sector investment.
At present, Bitcoin’s market cap stands near $2.1 trillion, while approximately $6.2 trillion is invested in gold via exchange-traded funds, bars, and coins.
“On that basis,” the note said, “Bitcoin’s market capitalization would need to rise by about 67%, implying a theoretical price close to $170,000.”
The analysts said this valuation framework reflects long-term potential rather than a near-term forecast.
Market sentiment, regulatory conditions, and liquidity factors will continue to influence how quickly Bitcoin might approach such levels.
Market context and sentiment shift
Last month, JPMorgan’s analysts issued a similar analysis, calling Bitcoin undervalued relative to gold and suggesting a possible year-end target around $165,000.
However, in a Block report, Panigirtzoglou said that recent liquidations and negative market sentiment made such a near-term rally unlikely.
Earlier in August, the same team projected a year-end target of about $126,000, which Bitcoin briefly surpassed on October 6, hitting an all-time high above $126,200 before a major liquidation event on October 10.
Despite recent volatility, JPMorgan’s latest note underscores a cautiously optimistic outlook.
With network fundamentals strengthening and production costs rising, analysts view current prices as near structural support levels — leaving room for long-term appreciation if broader market confidence returns.
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