JPMorgan Asset Management has added Bitcoin to its long-term capital market assumptions for the first time, projecting a 10% annualized return for the cryptocurrency over the coming decade while warning that its volatility and inconsistent correlations make it a poor portfolio diversifier.
The forecast, published in the firm’s 2027 long-term capital market assumptions report, places Bitcoin ahead of the expected 7.5% annual return for large-cap US equities and 5.5% for gold. Yet the asset manager does not treat the cryptocurrency as a conventional core holding alongside stocks, bonds or precious metals. Its models describe Bitcoin as a speculative asset that may offer protection against monetary easing, but whose portfolio behavior remains too unstable to reliably offset losses elsewhere.
JPMorgan Asset Management’s decision to include Bitcoin in an annual planning framework spanning more than 200 asset classes gives the cryptocurrency a formal place in one of Wall Street’s most widely followed long-range allocation exercises. The forecast does not amount to a recommendation to hold Bitcoin at any particular weight, and the report’s scenario range illustrates why the firm remains cautious.
A 10% base case with a wide range of outcomes
JPMorgan Asset Management’s base case assumes Bitcoin can produce annualized returns of 10% over the next 10 years. Its more optimistic scenario raises that figure to 16.6% a year, while its bear-case model assumes an annualized loss of 11.2%.
That gap is unusually wide compared with the range normally associated with mature public-market asset classes. The firm assigns Bitcoin annual volatility of roughly 55%, compared with about 18% for large-cap US equities. Volatility measures how sharply an asset’s price tends to move over time; a higher figure generally means a greater chance of large gains and losses within a short period.
The forecast therefore gives Bitcoin a stronger expected return than gold in JPMorgan Asset Management’s assumptions, but with a radically different risk profile. Gold’s role in portfolios has historically rested partly on its tendency to behave differently from risk assets during periods of stress. Bitcoin has at times been compared with gold because of its capped supply, but JPMorgan’s framework argues that the comparison remains incomplete from an allocation perspective.
Bitcoin’s relationship with equities, bonds and other assets has changed sharply across market cycles, the report says. Those unstable correlations limit its usefulness as a diversifier, an asset held partly because it may reduce the overall swings of a portfolio. During risk-off periods, Bitcoin has frequently traded more like a high-volatility technology asset than a defensive monetary hedge.
The model links supply, adoption and monetary conditions
JPMorgan Asset Management said its scenario calculations incorporate Bitcoin’s supply growth relative to money supply, its possible role alongside gold, and indicators of network adoption. Those inputs reflect a valuation approach that looks beyond short-term trading flows and attempts to measure Bitcoin’s potential place in the monetary system over a decade.
The money-supply element is particularly relevant to the report’s description of Bitcoin as a potential hedge against monetary easing. Bitcoin’s issuance schedule is fixed by its protocol, with the eventual supply capped at 21 million coins. Conventional currencies, by contrast, can expand as central banks and commercial banking systems increase the supply of money and credit.
That feature has long been central to the bullish case for Bitcoin, especially during periods of inflation concerns or expansive monetary policy. JPMorgan Asset Management’s forecast suggests the firm considers that argument sufficiently durable to model, while stopping well short of assuming that Bitcoin will consistently function as a safe haven.
Network adoption is another variable with substantial uncertainty. Wider use by individuals, companies, financial institutions or payment providers could support Bitcoin’s long-term position, while regulation, changes in market structure and competing technologies could alter that trajectory. The 16.6% bull case and 11.2% annualized-loss bear case show that the firm does not view adoption as a straight-line process.
Wall Street recognition meets portfolio constraints
Matt Hougan, chief investment officer at Bitwise, highlighted JPMorgan Asset Management’s addition of Bitcoin to its long-term assumptions in a post on X. Hougan has previously argued that formal treatment by large financial institutions can help move digital assets from a specialist allocation into mainstream wealth-management discussions.
Bitwise has taken a far more bullish view in its own long-range work. In an August 2025 forecast, the asset manager projected that Bitcoin could reach $1.3 million by 2035, implying a base-case annualized return of 28.3%. The difference between Bitwise’s projection and JPMorgan Asset Management’s 10% base case reflects a continuing divide in institutional approaches to Bitcoin’s potential market size and adoption curve.
JPMorgan’s estimate is more restrained, but its inclusion of Bitcoin alongside established asset classes places the cryptocurrency within the same forward-looking framework used for pension plans, endowments and other long-horizon portfolios. That changes the conversation from whether Bitcoin can be modeled at all to how its return potential should be weighed against its unusually large drawdown risk.
For portfolio managers, the report’s conclusions point toward position sizing rather than broad substitution. A high-return assumption can raise the expected return of a portfolio, but a 55% volatility estimate means that even a relatively small allocation can materially affect total risk. The unstable correlation assumptions make the calculation harder: an asset cannot be relied upon to cushion equity-market losses simply because it has sometimes traded independently.
Bitcoin’s first appearance in JPMorgan Asset Management’s long-term outlook therefore comes with a dual message. The firm sees a plausible path to returns above large-cap US stocks and gold over the next decade, while its own risk models argue against treating the asset as a dependable hedge or a standard diversification tool.
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