Bitcoin Outshines Gold Long Term Outlook

• JPMorgan says Bitcoin’s risk-adjusted profile has improved compared with gold over the long term.
• Bitcoin volatility relative to gold has fallen to a record low, according to JPMorgan data.
• JPMorgan estimates Bitcoin’s production cost near $87,000, with BTC trading below that level.

JPMorgan has stated that Bitcoin’s long-term appeal compared with gold has improved. The bank based this view on recent market data, including volatility trends and pricing metrics. While short-term pressure remains in crypto markets, JPMorgan said Bitcoin’s risk profile has shifted in its favor.

JPMorgan Compares Bitcoin and Gold Performance

JPMorgan noted that gold has strongly outperformed Bitcoin in recent months. This outperformance came alongside rising volatility in gold markets. As a result, the relative balance between the two assets has changed.

The bank said Bitcoin’s appeal has increased as gold volatility rose. At the same time, Bitcoin volatility compared with gold has declined. JPMorgan described this relative change as an important factor in long-term comparisons.

Gold has historically been viewed as a stable store of value. However, recent price swings have affected its volatility profile. JPMorgan said this shift has narrowed the stability gap between gold and Bitcoin.

The bank added that long-term investors often consider relative risk and return. Changes in volatility can affect asset allocation decisions. This comparison has become more relevant as both assets face macroeconomic uncertainty.

Bitcoin Trades Below Estimated Production Cost

JPMorgan observed that Bitcoin is trading well below its estimated production cost. The bank placed this cost near $87,000 based on mining expenses. Historically, such levels have acted as a soft floor for Bitcoin prices.

The bank said prices below production cost can pressure miners. However, they have often coincided with periods of market stabilization. JPMorgan did not state that this level guarantees a price rebound.

Bitcoin’s current pricing comes during a period of broader market weakness. Crypto markets have faced selling pressure and lower risk appetite. Despite this, JPMorgan said liquidations have remained limited.

The bank reported that forced selling has been modest compared with past downturns. This suggests leverage has not built up excessively. JPMorgan said this reduces the risk of disorderly market moves.

ETF Flows and Current Market Conditions

JPMorgan pointed out that spot Bitcoin exchange-traded funds continue to record outflows. These outflows reflect cautious investor sentiment in the short term. The bank said this trend has weighed on Bitcoin prices.

Despite ETF outflows, JPMorgan said overall market stress appears contained. The bank noted that liquidation data does not show panic conditions. This contrasts with earlier cycles marked by sharp forced selling.

The bank also said that broader macro factors continue to influence flows. Interest rate expectations and risk sentiment remain key drivers. These factors affect both digital assets and traditional safe havens.

JPMorgan did not indicate a near-term shift in ETF demand. Instead, it focused on longer-term structural comparisons. The bank said short-term flows do not fully reflect long-term positioning.

Risk-Adjusted Profile Favors Bitcoin Over Gold

JPMorgan’s main conclusion focused on risk-adjusted performance. The bank said Bitcoin’s volatility relative to gold has fallen to a record low. This change alters the long-term comparison between the two assets.

Lower relative volatility can improve Bitcoin’s risk-adjusted profile. JPMorgan said this suggests potential for better long-term returns versus gold. The bank emphasized that this view applies over extended time horizons.

The report stated that Bitcoin and gold serve different roles. However, both are often compared as alternatives to fiat currencies. Changes in volatility can influence how investors weigh these roles.

JPMorgan concluded that Bitcoin’s long-term attractiveness has strengthened versus gold. This assessment was based on volatility trends and pricing levels. The bank did not provide a specific price target.