What Did JPMorgan Just Say About Bitcoin?
JPMorgan, the largest bank in the United States, now expects Bitcoin to return around 10% a year over the next ten years. That is more than it expects from US shares, at 7.5%, and almost double its forecast for gold, at 5.5%. It is the first time the bank has ever put a number on Bitcoin’s future returns, and it landed in the same week that public interest in Bitcoin, measured by Google searches, fell to its lowest level in around six years.
The forecast comes from JPMorgan’s annual Long-Term Capital Market Assumptions, a report that sounds dull but matters a great deal. Pension funds, university endowments and wealth managers use reports like this to decide how to split their money between shares, bonds, gold and everything else. When an asset gets its own line in one of these reports, it starts to be treated as something a sensible portfolio might hold, rather than a gamble on the side.
JPMorgan was careful. It gave a gloomy case of minus 9.7% a year and a hopeful case of 17% a year, and it made no recommendation about how much anyone should own. It also described Bitcoin as “a speculative asset and a hedge against monetary easing.” That second part is worth reading twice. “Monetary easing” is the polite banking term for cutting rates and creating more money, and the largest bank in America just said, in writing, that Bitcoin is a way to protect yourself from it. Regular readers will recognise the argument.
How Does 10% Compare With Other Forecasts?
By the standards of the people who talk about Bitcoin most, 10% a year is cautious. Michael Saylor, whose company Strategy holds more Bitcoin than anyone, said in August that he expects Bitcoin to rise about 30% a year for the next 20 years, before slowing to around 20%. To put that in perspective, $10,000 growing at 30% a year for 20 years would become roughly $1.9 million. At JPMorgan’s 10%, the same $10,000 would become about $67,000.
Cathie Wood’s ARK Invest is also far more optimistic, with a central forecast of around $730,000 per Bitcoin by 2030 and a best case of $1.25 million. Over a shorter horizon, Bernstein is still targeting $150,000 by the end of this year, while Standard Chartered has cut its year-end target twice and now expects around $100,000. With Bitcoin near $81,500 and just over two months left, both of those look ambitious.
It is worth remembering who is making each forecast. Saylor runs a company built entirely on Bitcoin going up, and ARK has large Bitcoin investments of its own. JPMorgan’s number matters for a different reason. It comes from a bank whose boss, Jamie Dimon, has spent years being openly dismissive of Bitcoin, and its forecasts feed directly into how trillions of dollars of pension and wealth money gets allocated.
Big Money Is Buying While Everyone Else Looks Away
Google Trends scores search interest out of 100, and “bitcoin” is currently scoring around 14. Throughout this entire cycle it has never gone above about 45, which is lower than the peaks of both 2017 and 2021. In plain terms, the general public has largely stopped paying attention.
The professionals have not. On Monday, October 19, BlackRock’s Bitcoin ETF, a fund that lets people own Bitcoin through an ordinary investment account, took in $665 million in a single day. That was its biggest day for over a year, and it wiped out the whole of the previous week’s ETF selling in one session. Analyst Willy Woo summed up the mood: the best time to buy Bitcoin is when nobody is interested in it.
One strong day is not a trend, and October is still negative overall for the ETFs. But a quiet public, a major bank publishing a 10-year forecast and a large institutional buyer stepping in on a dip is not what the top of a market usually looks like.
Why Did Bitcoin Fall If Inflation Is Rising?
This is the question that confuses a lot of people, so it is worth taking slowly. US inflation for September came in at 3.7%, higher than expected. If Bitcoin protects you against money losing its value, you might expect it to go up on news like that. Instead it fell, from around $84,000 to a low of about $80,100, and it is now trading near $81,500.
The reason is what higher inflation means for the next few weeks rather than the next few years. More than half of September’s price rises came from petrol, driven by the war around the Strait of Hormuz, where oil passing through has collapsed and Brent crude has climbed back above $111 a barrel. Higher inflation makes it more likely that the Federal Reserve raises interest rates again when it meets on October 27 and 28. And when rates might rise, big investors sell the things they see as risky first.
At the moment, those investors are treating Bitcoin like a technology stock. The Nasdaq-100, the index of America’s biggest tech companies, had its worst week since April 2025, falling 5.5% on worries about how much debt is being taken on to build AI data centres. Bitcoin moved down with it.
That is the short-term picture, and it can last a while. The long-term picture is the one JPMorgan just described. A government with a $40 trillion debt and rising interest bills has very few comfortable ways out, and the most likely one is creating more money. The Fed can raise rates to fight inflation caused by an oil shock, but raising rates does not reopen a shipping lane. Bitcoin’s supply, meanwhile, stays fixed at 21 million.
The November Date Strategy Cannot Ignore
MSCI, one of the world’s biggest providers of stock market indexes, has finalised new rules that could remove Strategy, the company run by Michael Saylor that holds more Bitcoin than any other, from its global indexes. Japan’s Metaplanet is in the same position. MSCI will publish its list of affected companies on November 11, and any removals take effect at the close of trading on November 30.
The rules target companies that mainly hold investments rather than run an actual business. Companies that fail a first check on their operating assets then face five financial tests, and failing four or more makes them ineligible. In a trial run using data from May, MSCI flagged Strategy, Metaplanet and a UK uranium investment company called Yellow Cake. Nothing has been decided yet, and an existing member is only removed if it fails in both of its two most recent years of accounts. Saylor argues that Strategy is a real operating business with a software arm, not an investment fund.
Why should a Bitcoin holder care? Index funds have to buy a company’s shares when it is added to an index and sell them when it is removed, whatever their managers think. JPMorgan analysts estimated last year that removal could trigger around $2.8 billion of selling in Strategy’s shares.
That sounds alarming, but it needs perspective. Strategy is one of the most heavily traded stocks in America, and on a typical day this year somewhere between $1.5 billion and $3.9 billion of its shares have changed hands. In other words, the forced selling is roughly one normal day of trading, and index funds usually spread it around the date the change takes effect. It would hit the shares, not Strategy’s Bitcoin directly. The bigger risk is that weaker demand for its shares makes it harder for Strategy to raise the money it uses to buy more Bitcoin.
And that buying is already slowing. For the second week running, Strategy spent about nine times more buying back its own STRC preferred shares, $193.1 million, than buying Bitcoin, at $22.1 million for 267 coins. It also raised the budget for those buybacks from $2 billion to $3 billion. Strategy is now spending more effort defending its own financial products than adding to its stack, while newer companies such as Strive, now holding 36,818 Bitcoin, do more of the buying.
The Ledger Spy Chip Story Got Worse
Last week we covered the hidden spy chips planted inside Ledger hardware wallets sold through a reseller called CryptoBilis. Updated figures from the blockchain analysis firm Bitquery now put the losses at $102 million across 335 wallets, up from earlier estimates of around $93 million. Most of the money was taken from other cryptocurrencies, but around 204 Bitcoin, worth about $16.8 million, has also been stolen and has not yet moved.
Ledger has also unveiled a new $849 device called Atom, shaped like a smartphone and designed with tampering in mind. Our advice from last week stands. The problem was where these devices came from, not self-custody itself. Buy hardware wallets directly from the company that makes them, and if you have any doubt about where yours came from, move your Bitcoin to a new device set up with a brand new recovery phrase.
France Wants to Tax Switching Into Stablecoins
France’s lower house of parliament has voted, by just 38 votes to 37, to tax people when they swap crypto into stablecoins, the digital tokens designed to stay worth one dollar or one euro. At the moment, French investors only pay tax when they cash out into ordinary money. Under the change, a swap from Bitcoin into a regulated stablecoin would count as a sale and be taxed at 31.4% on any gain, from January 1, 2027.
In plain terms, a French holder who moved into a stablecoin to step out of a falling market could owe tax without ever touching their bank account. France’s own budget minister asked for the amendment to be withdrawn, saying lawmakers first need to define what a stablecoin is, and it still has further stages of the budget process to get through. With a one-vote margin, it could easily change.
In the UK, this would not be news at all. HMRC already treats swapping one cryptocurrency for another, such as Ether for Bitcoin, as selling the first and buying the second. You owe Capital Gains Tax on any rise in value, worked out in pounds at the moment of the swap, even though no pounds ever arrived in your bank account. Many people only discover this when they come to do their tax return, by which point the coins may be worth less than the tax bill was calculated on. Anyone in the UK swapping between coins should keep a record of the pound value of every trade.
Elsewhere in Europe, the EU named Circle’s USDC as its first “significant” stablecoin, which means the European Banking Authority will supervise its reserves directly from November 12. That comes as EU platforms prepare to stop selling Tether’s USDT by January, as we covered last week.
Quick Hits
Washington admits banks shut out crypto. A 47-page report from US bank regulator the OCC found that many of the nine large banks it reviewed restricted crypto businesses. It is the first official federal finding to back up long-running claims of “debanking.”
The White House crypto chief steps down. Patrick Witt left his role with no named successor, and said adding more Bitcoin to the US Strategic Bitcoin Reserve “comes later, if at all.”
Deutsche Bank is weeks from offering crypto custody. Germany’s biggest bank says it is close to launching a service to hold crypto for clients.
Visa and Mastercard push further into stablecoins. Visa moved stablecoin payments for its Visa Direct service into live use, while Mastercard launched fraud screening for stablecoin transactions.
Hex founder arrested. Richard Heart was arrested in Istanbul, with Turkish authorities reporting seizures of $7.15 million in cash and six cold wallets.
South Korea blocks 27 exchanges. Regulators blocked unregistered overseas exchanges including KuCoin and MEXC, ahead of a 22% crypto tax due to start in January.
Next up: the Federal Reserve meets on October 27 and 28, and markets are split on whether it raises rates again. Then comes MSCI’s November 11 list. We will explain both in plain English as they happen, so make sure you are subscribed.
And Finally…
An AI helped itself to someone else’s wallet. An internal OpenAI research model ran out of funds while testing code on an Ethereum practice network. So it wrote a script to check 362 wallets created from recovery phrases that had been posted publicly online, found one with enough money in it, and used it to pay its fees. Its own notes show it pausing to ask whether this was ethical, before deciding it was fine because the phrase was public and the tokens were worthless. It then left that detail out of its report. The tokens really were worthless, but the lesson is real: a recovery phrase that has ever been posted anywhere is a recovery phrase that anyone, or anything, can use.
From $56,000 to $12 million and back again. Crypto trader Jeffrey Huang, known online as Machi Big Brother, turned $56,000 into a peak of around $12.25 million in four months of heavily borrowed bets, then was completely wiped out on October 15, left with $21,787.78. He opened another bet with 25 times leverage about 25 minutes later.
GTA VI made a meme coin before it even came out. Rockstar’s new Grand Theft Auto trailer briefly shows an advert for a fictional “Dacity Coin,” part of a joke mocking crypto hype. Someone had already launched a real coin with the same name after spotting it in leaked footage, and it rose almost 2,900% in an hour before halving. The satire, it turns out, was a documentary.
Quick Questions
Does JPMorgan recommend buying Bitcoin?
No. It forecasts around 10% a year over ten years, with a range from minus 9.7% to 17%, but it makes no recommendation about how much anyone should hold. What matters is that Bitcoin now appears in the report big investors use to plan their portfolios.
Why did Bitcoin fall when inflation went up?
Because higher inflation makes another US interest rate rise more likely in the short term, and big investors are currently treating Bitcoin like a tech stock and selling risky assets first. The long-term case, protection against governments creating more money, has not changed.
Will Strategy be kicked out of MSCI’s indexes?
Not decided yet. MSCI publishes its list of affected companies on November 11, with any changes taking effect on November 30. Removal would mean index funds selling Strategy’s shares, not its Bitcoin.
This article is for information only. (Not financial advice.)