Key Takeaways
- • JPMorgan Asset Management projects bitcoin will deliver 10% annualized returns over the next decade in its 2027 Long-Term Capital Market Assumptions (LTCMA), with a bear case of -9.7% and a bull case of 17%.
- • The bank assigns bitcoin 55% volatility and a 20.9% arithmetic average annual return, while describing it as a speculative asset whose "volatility and unstable correlation to other asset classes" remain an obstacle to widespread portfolio inclusion.
- • Bitcoin is excluded from JPMorgan's main covariance matrices; the bank instead provides a separate, smaller matrix pairing BTC against a subset of assets.
- • The 10% bitcoin forecast exceeds JPMorgan's projections for U.S. large-cap stocks (7.5%), small-cap stocks (7.7%), U.S. REITs (8.2%), gold (5.5%), and Treasuries (5.6%-6.6%).
- • Bitwise CIO Matt Hougan publicly welcomed the inclusion of bitcoin in the LTCMA on X.
Summary
JPMorgan Asset Management's 2027 Long-Term Capital Market Assumptions report projects that bitcoin will deliver a 10% annualized return over the next decade, with a bear case of -9.7% and a bull case of 17%. The bank placed bitcoin's forecast against its other return projections, including 5.6%-6.6% for U.S. Treasuries, 7.5% for large-cap U.S. stocks, 7.7% for small-cap U.S. stocks, 5.5% for gold, 8.2% for U.S. REITs, and 7% for a 60/40 stock-bond portfolio. According to the report, the updated outlook accounts for productivity gains from artificial intelligence, corporate profitability and higher bond yields.
The report's framing of bitcoin is notably cautious. JPMorgan describes it as a speculative asset and says its volatility and unstable correlation to other asset classes "remain an obstacle to [its] widespread inclusion in portfolios." The bank also frames bitcoin as a hedge against monetary easing and states that the analysis "does not make a case for bitcoin as a portfolio diversifier." The report quantifies bitcoin's volatility at 55% and assigns an arithmetic average annual return of 20.9%, a figure distinct from the 10% compounded return in the headline forecast.
JPMorgan has not folded bitcoin into its main allocation models. The bank said it "debut[ed] bitcoin coverage, but unstable correlations to other assets impair a strategic allocation," and instead provides a separate, smaller covariance matrix with BTC against a subset of assets. The result is a tension between a return forecast that ranks bitcoin above every other asset class in the comparison set and a risk profile of 55% annualized volatility that keeps it outside core portfolio construction.
The forecast drew public attention from the crypto industry. Bitwise Chief Investment Officer Matt Hougan highlighted the projection on X, writing: "First they ignore you, then they laugh at you, then they fight you, and now they include you in their long-term capital market assumptions and predict you'll be the best-performing asset over the next decade."
The report's framing of bitcoin is notably cautious. JPMorgan describes it as a speculative asset and says its volatility and unstable correlation to other asset classes "remain an obstacle to [its] widespread inclusion in portfolios." The bank also frames bitcoin as a hedge against monetary easing and states that the analysis "does not make a case for bitcoin as a portfolio diversifier." The report quantifies bitcoin's volatility at 55% and assigns an arithmetic average annual return of 20.9%, a figure distinct from the 10% compounded return in the headline forecast.
JPMorgan has not folded bitcoin into its main allocation models. The bank said it "debut[ed] bitcoin coverage, but unstable correlations to other assets impair a strategic allocation," and instead provides a separate, smaller covariance matrix with BTC against a subset of assets. The result is a tension between a return forecast that ranks bitcoin above every other asset class in the comparison set and a risk profile of 55% annualized volatility that keeps it outside core portfolio construction.
The forecast drew public attention from the crypto industry. Bitwise Chief Investment Officer Matt Hougan highlighted the projection on X, writing: "First they ignore you, then they laugh at you, then they fight you, and now they include you in their long-term capital market assumptions and predict you'll be the best-performing asset over the next decade."
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