JPMorgan analysts have positioned Bitcoin as undervalued relative to gold, citing its declining volatility and increasing institutional adoption. The bank’s research, led by Nikolaos Panigirtzoglou, argues that Bitcoin’s six-month rolling volatility has dropped from nearly 60% at the beginning of the year to about 30%, aligning it closer to gold in terms of risk profile. On a volatility-adjusted basis, the bank estimates that Bitcoin’s market capitalization would need to rise by approximately 13%—translating to a price target of around $126,000—to align with gold’s $5 trillion private investment market. Currently trading near $111,600, this implies a potential upside of about $16,000, suggesting the cryptocurrency is undervalued by that margin [1].
The bank attributes the decline in Bitcoin’s volatility to increased adoption by corporate treasuries. These entities now hold over 6% of the total Bitcoin supply, with JPMorgan drawing parallels between this trend and how central bank quantitative easing dampened bond market volatility in the aftermath of the 2008 financial crisis. The accumulation of Bitcoin by corporations, including firms like Metaplanet and Nasdaq-listed KindlyMD, has contributed to market stability and passive capital inflows [2]. Additionally, index inclusion has bolstered Bitcoin’s institutional appeal. Metaplanet, for instance, was recently upgraded into the FTSE Russell mid-cap category and included in global benchmarks, further enhancing its exposure to passive investment flows [3].
JPMorgan’s analysis suggests that Bitcoin’s lower volatility has improved its risk-adjusted returns, making it increasingly attractive for institutional portfolios. The bank notes that the Bitcoin-to-gold volatility ratio has fallen to 2.0, the lowest recorded level, indicating that Bitcoin now requires only twice as much risk capital as gold in portfolio construction. This shift is significant as it reduces the perceived risk of allocating capital to Bitcoin, aligning it more closely with traditional safe-haven assets [4]. The bank’s volatility-adjusted models imply that Bitcoin could reach its fair value of $126,000 by year-end 2025, a target supported by the continued stabilization of its price and broader institutional acceptance [5].
In addition to volatility normalization, JPMorgan highlights structural factors that are reshaping Bitcoin’s investment landscape. Corporate treasury demand is intensifying competition among firms seeking to establish significant Bitcoin holdings. For example, KindlyMD has filed to raise up to $5 billion after acquiring $679 million in Bitcoin, while Adam Back’s BSTR is aiming to rival Marathon Digital as a major corporate holder. These developments indicate a maturing market where Bitcoin is increasingly viewed as a strategic reserve asset rather than a speculative commodity [6].
The report also underscores the growing legitimacy of Bitcoin through equity index inclusion. Companies with Bitcoin exposure are being added to global benchmarks, which not only increases their visibility but also attracts capital from index-tracking funds. This structural shift is expected to further enhance Bitcoin’s appeal as a diversified portfolio component. JPMorgan analysts suggest that lower volatility, combined with improved liquidity and institutional adoption, strengthens the case for Bitcoin as a legitimate alternative to traditional assets like gold [1].
Industry observers have responded positively to JPMorgan’s analysis, with some predicting a long-term convergence with gold. Joe Consorti, head of growth at Theya, argues that if Bitcoin and gold maintain their current five-year compound growth rates, parity could be achieved by late 2031, implying a $53 trillion market cap for Bitcoin and a price north of $2.5 million per coin. While these projections are more speculative, they reflect the broader market sentiment that Bitcoin’s trajectory is moving toward mainstream acceptance [5].
Source:
[1] title1 (https://www.coindesk.com/markets/2025/08/28/bitcoin-undervalued-versus-gold-as-volatility-collapses-jpmorgan-says)
[2] title2 (https://finance.yahoo.com/news/bitcoin-undervalued-compared-gold-fair-172230487.html)
[3] title3 (https://bitbo.io/news/jpmorgan-bitcoin-126k-forecast/)
[4] title4 (https://thedefiant.io/news/markets/jpmorgan-says-bitcoin-undervalued-versus-gold-volatility-hits-record-low-01a7c4da)
[5] title5 (https://www.mitrade.com/insights/news/live-news/article-3-1080050-20250829)
[6] title6 (https://coinlaw.io/jpmorgan-bitcoin-forecast-126k/)
