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U.S. investment banking giant JPMorgan has released a new analysis suggesting that Bitcoin remains undervalued compared to gold and could rise to $170,000 within the next 6 to 12 months. According to the bank’s analysts, based on volatility and risk-return metrics, Bitcoin’s “fair value” is significantly higher than its current market price.
JPMorgan: Bitcoin Is Undervalued Compared to Gold
In a note led by strategist Nikolaos Panigirtzoglou, JPMorgan stated that Bitcoin currently trades below its historical valuation relative to gold. The report notes that Bitcoin is priced around $102,000, roughly two-thirds of the value proportionate to private gold investment holdings, and that its fair value should be closer to $170,000.
According to JPMorgan’s estimates, total private investment in gold stands at $6.2 trillion. For Bitcoin to reach a similar proportionate scale, its market capitalization would need to increase by about two-thirds implying a 67% price rise from current levels.
Volatility Balance Shifts in Bitcoin’s Favor
The analysts highlighted that as gold’s price volatility has increased in recent weeks, Bitcoin has become more attractive from a risk-reward perspective.
“We believe that futures markets are currently the most important instrument to monitor. Given the recent period of stability, it appears that the liquidation of risky positions has largely concluded,” the report noted.
JPMorgan pointed out that the deleveraging cycle in perpetual futures markets has mostly ended, laying the groundwork for a new bullish phase in Bitcoin’s market structure.
Deleveraging Phase Is Over
According to the bank’s research, the recent selling pressure in the market was mainly due to liquidations in derivatives. Analysts believe that after the October and November corrections, the market has stabilized, creating favorable conditions for a steady upward trend in the months ahead.
The report also emphasized that growing volatility in gold has begun to shift investor behavior. While retail investors still prefer gold and U.S. equities, Bitcoin is increasingly being viewed as an alternative hedge against stock market risk. JPMorgan’s analysts noted that this trend is also strengthening among institutional investors and central banks, signaling that digital assets are evolving into a new “safe-haven” asset class.
JPMorgan’s Model Suggests a Fair Value of $170,000
The bank’s gold-based valuation model shows that Bitcoin’s current price is approximately $68,000 below its fair value. Analysts explain that this gap indicates BTC remains undervalued on a risk-adjusted capital basis.
“This forecast isn’t based on sentiment or momentum indicators but on a mechanical model grounded in capital risk metrics. Therefore, the $170,000 target is supported by fundamentals rather than market psychology,” the report said.
Analysis
JPMorgan’s report suggests that institutional investors are once again beginning to recognize Bitcoin’s long-term value. The bank’s $170,000 price target is based on two key factors:
- Closing the valuation gap with gold, and
- The end of the deleveraging phase, signaling renewed market stability.
According to experts, this forecast points to a strong bullish scenario for Bitcoin in the first half of 2025, potentially marking the beginning of a new growth cycle driven by institutional capital and macroeconomic normalization.
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