J.P. Morgan Sets 10% Bitcoin Return Forecast, Top of Its 15-Year Asset Table

First Long-Term Bitcoin Forecast by J.P. Morgan

J.P. Morgan Asset Management has issued its first long-term return forecast for Bitcoin. In its 2027 Long-Term Capital Market Assumptions report released Monday, the firm projected a 10% compound annual return for the digital currency over the next 10 to 15 years. This projection places Bitcoin at the top of the bank’s long-term asset outlook, surpassing its forecasts for U.S. large-cap stocks and gold.

Key Numbers From the Report

• J.P. Morgan forecasts a 10% compound annual return for Bitcoin over 10-15 years.
• The forecast for U.S. large-cap stocks is 7.5%.
• The forecast for gold is 5.5%.
• The forecast for a 60/40 stock-bond portfolio is 7%.
• Bitcoin’s annualized volatility is estimated at 55%, compared to 17% for gold.

Why J.P. Morgan Kept Bitcoin Out of Core Models

Despite its high projected returns, J.P. Morgan did not include Bitcoin in its main covariance matrices, which are models used to track how different assets move together. The report states that Bitcoin’s volatility and unstable correlations make it difficult to integrate into widespread portfolio models. Instead, the firm created a smaller, separate matrix to compare Bitcoin with a limited group of assets.

Expert Reactions to the Forecast

Matt Hougan, Chief Investment Officer at Bitwise, welcomed the inclusion of Bitcoin in the major forecast. On X, he noted that this marks a significant milestone for the asset. However, Hougan argued that J.P. Morgan’s 55% volatility assumption is too high, which he believes makes the return forecast too conservative. Bitwise manages crypto index funds and ETFs, giving it a direct stake in the outlook. J.P. Morgan also pushed back on a popular theory that widespread currency debasement will automatically drive investors into crypto, labeling that argument “wide of the mark.”

Bitcoin Market Context

The forecast arrives as U.S. spot Bitcoin ETFs, which are funds that hold actual Bitcoin, saw their best day since September 22. On Monday, these funds drew in $526.7 million in total. BlackRock’s IBIT fund alone took in $665.2 million. This inflow trimmed October’s net outflows to about $88 million. At the time of the report, Bitcoin traded around $82,000, while the 10-year U.S. Treasury yield remained above 5%.

What the Bank Is Doing in Crypto

J.P. Morgan is simultaneously expanding its own blockchain initiatives. The bank is bringing JPM Coin, a digital token representing dollar deposits, to the Ethereum network. It has also joined major firms like BlackRock and Goldman Sachs in efforts to tokenize stocks.

Sources

• Decrypt