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JPMorgan suggests that bitcoin’s reduced volatility compared to gold could enhance its appeal over the long term.
ETF redemptions and futures liquidations are exerting pressure on the cryptocurrency markets, according to the bank, even as increasing gold volatility subtly bolsters bitcoin’s long-term investment proposition.
JPMorgan indicates that bitcoin’s reduced volatility in comparison to gold could render it ‘more appealing’ over the long haul. (Unsplash, modified by CoinDesk)
What to know:
- Bitcoin has diverged from conventional safe havens such as gold and silver, with the cryptocurrency expected to weaken into 2026 despite gold’s rise of over 60% in 2025.
- JPMorgan analysts assert that the recent decline in digital assets, including bitcoin and ether ETFs, demonstrates diminishing interest as a hedge and widespread negative sentiment among both institutional and retail investors.
- Even with the downturn, JPMorgan contends that bitcoin’s comparatively low volatility relative to gold highlights its long-term promise as a safe-haven asset, although a volatility-adjusted price near $266,000 is considered unlikely in the short term.
Despite its established image as “digital gold,” bitcoin has notably diverged from traditional safe havens such as gold and silver, which may not necessarily hinder the digital asset’s prospects, as per JPMorgan analysts.
Gold experienced an increase of over 60% in 2025, driven by sustained central bank acquisitions and demand for safety, while bitcoin has faced challenges leading into 2026, exhibiting successive monthly declines and lagging behind major risk assets. JPMorgan’s analysis implies that this widening disparity indicates bitcoin’s diminishing role as a hedge against market instability.
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Digital assets “faced additional pressure over the last week as risk assets, especially in technology, came under strain and as gold and silver, the other perceived hedges against a catastrophic scenario, experienced a notable correction,” analysts led by Nikolaos Panigirtzoglou noted.
This selloff has also impacted spot bitcoin and ether exchange-traded funds (ETFs), indicating widespread negative sentiment among both institutional and retail investors, according to JPMorgan analysts. The negative sentiment has also influenced the supply of stablecoins, which has decreased, the report stated.
‘Catastrophic scenario’
Nonetheless, JPMorgan still perceives a long-term case for bitcoin.
The report indicated that gold has outperformed bitcoin since last October, but with significantly higher volatility, which makes bitcoin “even more appealing in comparison to gold.”
Theoretically, if bitcoin were to match the recent volatility observed in gold, the price of the digital asset would need to rise to approximately $266,000 to align with the investments being made in gold, which the analysts agree is improbable. However, this low volatility emphasizes bitcoin’s future potential as a safe haven.
“This $266k volatility-adjusted comparison to gold is, in our view, an unrealistic target for this year, but it illustrates the upside potential in the long run once negative sentiment shifts and once bitcoin is once again regarded as equally appealing to gold as a potential hedge against a catastrophic scenario,” the analysts stated.
Read more: Bitcoin nears pre-election floor as ETF flows stall, Citi says
