- JPMorgan analysts say bitcoin is undervalued compared to gold and could hit $165,000 by year-end.
- The “debasement trade,” driven by retail flows into bitcoin and gold ETFs, is fueling demand for alternative stores of value.
- With BTC at $119,000, the bank’s new forecast reflects a 42% upside as gold prices continue to surge.
JPMorgan analysts argue that bitcoin is significantly undervalued relative to gold on a volatility-adjusted basis. The bitcoin-to-gold volatility ratio has now dropped below 2.0, meaning BTC requires only 1.85 times more risk capital than gold. Based on this ratio, bitcoin’s $2.3 trillion market cap would need to grow by 42% — implying a year-end target of $165,000 — to align with the $6 trillion invested in gold via ETFs, bars, and coins.
The report highlights how this valuation gap has shifted: at the end of 2024, bitcoin was considered $36,000 overvalued compared to gold. Today, it’s roughly $46,000 undervalued, creating a strong case for upside.
The Rise of the Debasement Trade
Driving this shift is what JPMorgan calls the “debasement trade,” as investors flock to bitcoin and gold as hedges against deficits, inflation, and weakening fiat currencies. Retail investors have been the main force, pouring into spot bitcoin and gold ETFs since late 2024.
While institutional players have participated through CME futures, their involvement has lagged compared to ETF inflows, underscoring how much of this momentum is retail-driven. Bitcoin ETF flows spiked earlier in 2025, while gold ETFs have recently gained traction, narrowing the gap between the two assets.
A Bullish Outlook Into Year-End
Bitcoin currently trades near $119,000, but JPMorgan’s new price target reflects gold’s recent surge, which makes BTC look more attractive on a relative basis. Back in August, the bank projected $126,000 by year-end. Now, with stronger demand for safe-haven assets and growing retail participation, the revised forecast suggests bitcoin could climb as high as $165,000 before 2025 ends.
This bullish call aligns with other analysts and firms who are targeting even loftier milestones, with some projecting $200,000 in the near term.
