JPMorgan Asset Management's annual long-term return outlook has handed Bitcoin a projected 10% compound annual return over the next decade, the highest base-case figure in the study -- but Grayscale's head of research argues the more consequential number sits elsewhere in the report.
In a note dated Nov. 4, Zach Pandl described Bitcoin's appearance in the firm's 2027 Long-Term Capital Market Assumptions as "another milestone in its evolution as an institutional asset." The publication, now in its 31st edition, projects returns over a 10- to 15-year horizon and is widely used by pension funds, endowments and financial advisers when allocating capital.
The return estimate puts Bitcoin ahead of most traditional assets in the bank's forecast:
Note: Figures are JPMorgan's base-case projections from its 2027 Long-Term Capital Market Assumptions.
Pandl's analysis, however, centers on correlation -- a measure of how closely two assets move together. JPMorgan estimates Bitcoin's correlation with U.S. large-cap equities at 33%, a reading that, according to a Grayscale chart built from the report, is below that of international stocks, corporate bonds and hedge funds. High expected returns paired with a weak link to equities are an unusual combination, Pandl wrote, calling it one that makes Bitcoin "a potentially attractive portfolio diversifier."
The report does not come without qualifications. JPMorgan assigns Bitcoin expected volatility of 55%, and its own chart shows gold carrying an even lower correlation to stocks. The firm also states that it does "not yet include bitcoin in our main covariance matrices" -- the models it uses to construct multi-asset portfolios. Pandl acknowledged that uncertainty, noting that any diversification benefit will hinge on how Bitcoin's returns and its relationships with other assets develop.
The distinction matters for institutional readers. A headline return figure can draw attention, but portfolio construction depends on how an asset behaves alongside everything else in the book. An asset that offers a high expected return while moving largely independently of stocks can improve a portfolio's risk-adjusted profile; one that tracks equities closely offers less.
Bitcoin's price action offered a reminder of the volatility side of that equation. The token traded near $75,301 at the time of publication, down roughly 4.5% over 24 hours, according to Decibel data.
For investors, the takeaway is less about the 10% number than about the framework behind it. Inclusion in a major bank's capital market assumptions signals that Bitcoin is being evaluated on the same terms as equities, credit and private assets -- a shift in treatment rather than an endorsement. The cautious language around covariance matrices suggests the bank sees the case as promising but not yet settled, and the wide gap between a 10% expected return and 55% expected volatility leaves room for allocations to remain small and deliberate.
