JPMorgan’s investment arm — JP Morgan Asset Management — included Bitcoin in its long-term forecast of asset returns to 2027; the unit manages about $5 trillion, and it estimated Bitcoin’s compound annual growth rate (CAGR) over the next ten years at 10%.
Ten-year return forecast
Under the base case, the leading cryptocurrency could deliver a compound annual growth rate (CAGR) of 10% over the next ten years. Grayscale highlighted the report.
The document notes that Bitcoin’s potential returns exceed expected results from traditional asset classes but come with higher investment risks. It emphasises that, because correlations are unstable, the cryptocurrency was not included in the primary covariance matrices used to model relationships between assets.
Correlation with markets and volatility
The report says Bitcoin’s correlation with large US equities is 33%, lower than for international equities, corporate bonds and hedge funds. The combination of high expected returns and relatively low correlation is seen as a potential portfolio diversification tool.
At the same time, Bitcoin’s annual volatility was estimated at 55%. Cryptocurrencies are highly volatile. Bitcoin’s real benefits for diversification will depend on future changes in its returns and links with other markets.
Other long-term estimates for Bitcoin
The report also cites other forecasts, mentioning long-term estimates from other market participants. In particular, VanEck suggested that, if Bitcoin were widely used in global trade, its price could reach $3 million by 2050.
VanEck’s head of digital asset research, Matthew Sigel, called Bitcoin a long-term hedge against dollar debasement. To check prices and market capitalisation, follow the current rates for cryptocurrencies.
