Bitcoin News Today: JPMorgan: Bitcoin's Gold-Adjusted Undervaluation Sparks $165K Call

JPMorgan analysts have raised their year-end bitcoin price target to $165,000, citing a significant undervaluation relative to gold and surging retail investor demand. The bank's report, led by managing director Nikolaos Panigirtzoglou, highlights that bitcoin's volatility-adjusted value has shifted from a $36,000 overvaluation in late 2024 to a $46,000 undervaluation as of now. This shift is driven by a declining bitcoin-to-gold volatility ratio, which has fallen below 2.0, indicating bitcoin now requires only 1.85 times more risk capital than gold. Based on these metrics, JPMorgan estimates bitcoin's market cap would need to rise by 42%-implying a price of $165,000-to align with the $6 trillion invested in private gold holdings.

The bank attributes bitcoin's recent momentum to what it terms the "debasement trade," a surge in demand for alternative stores of value amid concerns over inflation, government deficits, and weakening fiat currencies. Retail investors have been the primary drivers of this trend, with heavy inflows into bitcoin and gold ETFs since late 2024. Bitcoin ETF inflows initially outpaced gold in early 2025, particularly following the "Liberation Day" event, but gold ETF flows have since narrowed the gap. JPMorgan notes that while institutional investors have participated via CME futures, their activity has lagged behind retail ETF demand, underscoring the retail-driven nature of the debasement trade.

Gold's recent rally has further bolstered bitcoin's relative appeal. As gold prices surged, the volatility-adjusted valuation gap between the two assets widened, reinforcing JPMorgan's view of bitcoin's undervaluation. The bank's previous year-end target of $126,000, set in August 2025, has been upwardly revised to reflect this dynamic. This adjustment aligns with broader bullish sentiment, as other analysts have projected bitcoin could reach $200,000 by year-end. As of now, bitcoin trades near $119,000, leaving room for a 40% gain if JPMorgan's target materializes.

The bank's analysis also highlights structural shifts in investor behavior. Retail participation in the debasement trade has been amplified by macroeconomic uncertainties, including geopolitical risks and declining trust in fiat currencies. Institutional activity, while present through futures markets, has not matched the pace of retail-driven ETF inflows. JPMorgan emphasizes that bitcoin's role as a hedge against economic and political risks is evolving, with its valuation increasingly tied to gold's performance.

JPMorgan's forecast adds to a growing consensus of optimism for bitcoin's near-term prospects. The bank's models suggest that bitcoin's relative valuation, combined with sustained demand for alternative assets, could drive significant upside. However, the realization of this target depends on the persistence of the debasement trade and bitcoin's ability to compete with gold for capital allocation. For now, the report underscores bitcoin's position as a key player in the broader macroeconomic narrative of diversification and risk mitigation.

Source: [1] JPMorgan Predicts $165K Bitcoin Price by Year-End (https://bitbo.io/news/jpmorgan-bitcoin-165k-forecast/)

[2] Bitcoin Could Reach $165K Based on Gold's Record Run: JPMorgan (https://www.coindesk.com/markets/2025/10/02/bitcoin-could-reach-usd165k-based-on-gold-s-record-run-jpmorgan)

[3] JPMorgan sees Bitcoin climbing to $165,000 by year-end (https://coinjournal.net/news/jpmorgan-sees-bitcoin-climbing-to-165000-by-year-end-citing-gold-valuation-gap/)

[4] JPMorgan Predicts Bitcoin Could Hit $165K by Year-End on Retail ... (https://blocknews.com/jpmorgan-predicts-bitcoin-could-hit-165k-by-year-end-on-retail-led-debasement-trade/)