JPMorgan Asset Management expects Bitcoin to generate an annual compounded return of 10% over the next 10 to 15 years, according to its first long-term forecast for the cryptocurrency. The projection places Bitcoin ahead of U.S. large-cap stocks, real estate investment trusts (REITs) and gold, making it the highest-returning asset in the comparison.

The estimate was published on October 19 in JPMorgan’s 2027 Long-Term Capital Market Assumptions, the 31st edition of its annual outlook. The report covers more than 200 asset classes and evaluates their potential performance over a 10- to 15-year period to help investors develop long-term strategies.

JPMorgan’s projections put Bitcoin’s annual compounded return at 10%, compared with 8.2% for U.S. REITs, 7.5% for U.S. large-cap equities and 5.5% for gold. Bitcoin leads large-cap stocks by 2.5 percentage points, REITs by 1.8 points and gold by 4.5 points.

U.S. small-cap equities have a projected return of 7.7% in figures shared by Bitwise Chief Investment Officer Matt Hougan, who drew attention to Bitcoin’s position in the rankings. His description of Bitcoin as the strongest-performing asset reflects his interpretation of the data. JPMorgan’s estimates are designed for long-term planning and do not predict short-term market movements.

The forecast comes amid increasing participation by traditional financial institutions in the digital asset industry. JPMorgan’s institutional activities involving Ethereum further illustrate the bank’s expanding engagement with cryptocurrencies.

Bitcoin’s Return Potential Is Matched by Higher Volatility

JPMorgan’s projected return comes with considerable risk. The asset manager estimates Bitcoin’s annualized volatility at 55%, compared with 18% for U.S. large-cap stocks and 17.2% for gold.

The report also assigns Bitcoin an arithmetic average annual return of 20.9%. This figure differs from the 10% compounded return because arithmetic returns calculate the simple average of yearly performance, while compounded returns account for the cumulative impact of gains and losses over time.

For long-term investors, compounded returns offer a clearer picture of how an investment could grow. Volatile assets can produce a significant gap between their average annual returns and actual growth because losses reduce the capital available for future gains.

At a consistent annual growth rate of 10%, an investment would increase to approximately 2.59 times its original value over 10 years and 4.18 times over 15 years. These calculations are illustrative, however, and do not guarantee that Bitcoin will deliver the projected performance.

Broader economic conditions could also affect its trajectory. Movements in U.S. Treasury real yields can influence investor appetite for riskier assets and competing stores of value, making macroeconomic developments an important factor in Bitcoin’s long-term outlook.

Why JPMorgan Has Not Included Bitcoin in Its Main Portfolio Model

Despite Bitcoin’s leading return projection, JPMorgan has excluded the cryptocurrency from its primary covariance matrices used for long-term portfolio construction. Instead, the firm evaluates Bitcoin through a separate, smaller matrix covering selected publicly traded assets.

Covariance matrices measure how the returns of different investments move in relation to one another. Portfolio managers use them to assess diversification benefits and determine how individual assets could affect overall portfolio risk.

JPMorgan identifies Bitcoin’s elevated volatility and inconsistent correlations with traditional investments as major barriers to including it in the main framework. These characteristics make it more challenging to determine how Bitcoin might behave alongside stocks, bonds and other holdings under changing market conditions.

As a result, the 10% return projection should not be interpreted as a recommendation for a specific Bitcoin allocation. An asset can offer attractive long-term return potential while still presenting challenges for institutional investors seeking to balance performance and risk.

Bitcoin ETF activity offers another perspective on institutional demand. Periods of sustained outflows from Bitcoin exchange-traded funds show that actual investment flows can differ from long-term return expectations. While ETF flows reflect shorter-term investor positioning, capital market assumptions focus on potential performance over a decade or more.

Bitcoin Outpaces Traditional Portfolio Return Projections

JPMorgan estimates that a U.S. dollar portfolio comprising 60% equities and 40% bonds could deliver an annual return of 7% over the same horizon. A portfolio with a 30% allocation to diversified alternative investments could generate a projected 7.5% return, depending on its composition.

Bitcoin’s modeled compounded return of 10% exceeds both estimates. However, its significantly higher volatility means investors must weigh the potential gains against the possibility of substantial losses and the challenges of incorporating the asset into diversified portfolios.

The asset manager’s broader projections account for factors such as artificial intelligence-driven productivity improvements, corporate profitability and higher bond yields. The assumptions are based on information available through September 30, 2026, and are updated annually to support long-term investment planning.

JPMorgan’s forecast therefore presents Bitcoin as a potentially higher-returning asset over the coming decade, while emphasizing the risk and portfolio-construction challenges that could limit its role in traditional investment strategies.