JPMorgan projects bitcoin to return 10% annually over the next decade, topping stocks and bonds.

JPMorgan has put numbers on bitcoin’s next decade for the first time, and its base case beats every traditional asset class it tracks. For allocators weighing digital assets, the bank’s caution about volatility and correlations matters as much as the headline return.

• JPMorgan’s base case has bitcoin returning 10% annually over ten years, ahead of stocks, bonds and gold.
• The bear case is a 9.7% annual loss, while the bull case is a 17% annual gain.
• JPMorgan still calls bitcoin speculative, citing volatility and unstable correlations as obstacles to widespread portfolio inclusion.

• 10% JPMorgan’s base-case annual bitcoin return, versus 7.7% for U.S. small caps
• -9.7% Bear-case annual bitcoin return, set against a 17% bull-case gain
• 17% Bull-case annual bitcoin return, against 10% in the base case
• 5.5% Projected annual gold return, below the 5.6%-6.6% forecast for U.S. bonds

JPMorgan expects bitcoin to return 10% a year over the next decade in its base case, ahead of its forecasts for U.S. stocks, bonds and gold, CoinDesk reported. The bank published the figures on Tuesday (October 20) in its 2027 Long-Term Capital Market Assumptions report. It is the first time JPMorgan has put a range on bitcoin returns in its research.

JPMorgan’s 10% base case tops U.S. equities, bonds and gold

JPMorgan projects U.S. large-cap equities at 7.5% a year and small caps at 7.7%. Bitcoin’s 10% base case sits 2.3 percentage points above the better of those two. U.S. bonds are forecast at 5.6% to 6.6%.

Gold is forecast at 5.5%, which leaves bitcoin’s base case 4.5 percentage points ahead. The bear case of a 9.7% annual loss and the bull case of a 17% gain sit 26.7 points apart.

Shah and Cristallo call bitcoin a speculative hedge against monetary easing

The bank kept a cautious tone. It said bitcoin’s “volatility and unstable correlation to other asset classes…remain an obstacle to [its] widespread inclusion in portfolios.”

JPMorgan does not make a case for bitcoin as a diversifier. Portfolio manager Dr Sheena Shah and head of digital asset strategy Dennis Cristallo call it a “speculative asset and a hedge against monetary easing.” They added a further point on its role in a portfolio.

It lacks a strategic role in portfolios other than as a bet on fiat currency expansion or future asset trading on blockchains.

Dr Sheena Shah, portfolio manager, and Dennis Cristallo, head of digital asset strategy, JPMorgan

The authors wrote that bitcoin “mostly trades like a high beta risk asset that tracks global money supply growth, but it is sometimes treated as ‘digital gold.'” Unstable correlations with other assets present a modeling hurdle.

Forecasting is harder still, they said, because bitcoin’s fundamentals are not cash flows. Its economics may be as much about adoption, regulation and liquidity as technology.

Dimon’s 2017 “fraud” call is the backdrop to JPMorgan’s first bitcoin range

The New York-based bank has a complicated history with cryptocurrency, largely because of CEO Jamie Dimon’s widely publicized views. Dimon described the world’s largest crypto as a “fraud” in 2017. He has reiterated that skepticism in somewhat softer language in recent years.

The reporting carries no comment from Dimon on the new forecasts, and no bitcoin advocates are quoted. The only voices represented are the bank’s own authors.

The BlockWest read. We read the forecast as a sizing guide, not an endorsement. A 10% base case, a 9.7% annual loss in the bear case and a bank that sees no strategic role beyond a bet on money expansion all point to small, tactical positions. Allocators benchmarked to equities at 7.7% are offered a 2.3-point premium for absorbing a 26.7-point range of outcomes.

The open question is whether bitcoin’s correlations settle enough to move it from a speculative bet to a portfolio holding. Shah and Cristallo name unstable correlations as a core obstacle to widespread inclusion. Until that changes, JPMorgan’s 10% base case sits beside a stated reluctance to treat the asset as a strategic allocation.

BlockWest is a news publication. Nothing here is investment advice. Read our disclaimer and editorial policy.