JP Morgan Predicts Bitcoin Will Outperform Gold in 2025

JP Morgan has forecasted that Bitcoin will outperform gold in 2025, anticipating more upside for the cryptocurrency in the second half of the year.

The U.S. state-level purchasing of Bitcoin for strategic reserves could serve as a sustained positive catalyst for Bitcoin's performance in 2025, according to JP Morgan.

In its latest report, the investment banking giant said it expects Bitcoin to outperform gold next year.

“We expect more upside in the second half of 2025, possibly with BTC outperforming gold in the year-end 2025 price total return,” the report, part of the bank’s "Guide to the Cryptocurrency Markets," read.

The bank's strategists noted that several U.S. states, such as Montana and Mississippi, have already begun investing in Bitcoin for their strategic reserves.

"This move by state treasurers could be viewed as an interesting development in the broader narrative of institutional adoption of digital assets," the strategists said.

Earlier this year, Montana became the first U.S. state to purchase Bitcoin for its strategic treasury reserves. The state’s treasurer, Rafael Lopez, said at the time that the decision was made due to concerns over the U.S. dollar and rising inflation.

“We’re seeing the value of the U.S. dollar diminish over time, and we’re also seeing inflation rise at rates not seen in decades,” Lopez said in a statement.

In March, Mississippi also announced that it would be investing a portion of its $25 billion liquidity in Bitcoin.

The strategists at JP Morgan said they expect this trend to continue in 2025, and that it could help to push Bitcoin higher.

"We believe that this development could serve as a sustained positive catalyst for Bitcoin's performance throughout 2025," they said.

The strategists also noted that the U.S. states are turning to Bitcoin as an asset class in the same way that institutions have traditionally invested in gold.

"This shift in asset allocation could have significant implications for both Bitcoin and the broader cryptocurrency market."

The strategists concluded by saying that they are optimistic on the future of Bitcoin, and that they expect the cryptocurrency to continue to gain value in the years to come.

"We believe that Bitcoin is well-positioned to benefit from several macro-economic trends, including low interest rates, high inflation, and the ongoing search for yield."

Their outlook suggests growing institutional interest and potential increased adoption of Bitcoin as an asset class compared to traditional safe havens like gold.