JPMorgan Asset Management expects Bitcoin to deliver stronger long-term returns than U.S. large-cap stocks and gold over the next 10 to 15 years. According to the firm's projections, Bitcoin's compound annual return is estimated at 10%.
By comparison, JPMorgan's long-term capital market assumptions place U.S. large-cap stocks at 7.5%, U.S. real estate investment trusts at 8.2%, and gold at 5.5%. The firm also estimates Bitcoin's arithmetic annual return at 20.9%, alongside an annualized volatility of 55%. This forecast marks JPMorgan's first attempt to quantify Bitcoin's long-term return potential.
Despite including Bitcoin in its long-term return assumptions, JPMorgan has kept the cryptocurrency outside its main portfolio allocation calculations. The firm cited Bitcoin's high volatility and unstable correlations with traditional assets as the reasons for treating it separately and omitting it from its main covariance matrices.
Bitwise Chief Investment Officer Matt Hougan highlighted the forecast on social media, pointing to Bitcoin's inclusion as a sign of changing institutional attitudes and noting the significance of a major asset manager formally assessing the cryptocurrency alongside traditional investments.
JPMorgan's broader macroeconomic outlook anticipates stronger economic growth over the next 10 to 15 years, driven in part by a projected $15 trillion global capital expenditure surge in artificial intelligence and productivity gains. The firm forecasts U.S. real GDP growth at 2.1% and developed-market nominal growth at 4.2%.
While Bitcoin's projected compound annual return leads the listed assets in the report, JPMorgan's analysis emphasizes that forward-looking estimates do not guarantee performance. Investors must continue to weigh potential returns against high volatility and Bitcoin's uncertain relationships with other asset classes.
