Bitcoin’s 10% annual return assumption leaves a gap with JPMorgan portfolio allocations

Bitcoin received the highest long-term return assumption among major public-market assets but remained outside recommended portfolio allocations, according to an analysis of JPMorgan Asset Management’s research. The finding highlights a gap between institutional support for considering Bitcoin and the decision to commit capital.

In an October 22 video, Bitcoin analyst Joe Consorti examined JPMorgan Asset Management’s Long-Term Capital Market Assumptions, saying Bitcoin had received a return forecast without inclusion in the framework that determines portfolio allocations.

The report assumed a 10% compound annual return for Bitcoin, Consorti said. That exceeded gold at 5.5%, U.S. Treasuries at 5.6–6.6%, a 60–40 stock-and-bond portfolio at 7%, U.S. large-cap stocks at 7.5% and small-cap stocks at 7.7%. Small-cap private equity at 10.6% and value-added real estate at 10.2% ranked higher, however, leaving Bitcoin behind some private-market investments.

The starting price was approximately $83,000, Bitcoin’s September 30 closing level. Consorti said the report’s 10% annual return assumption implied approximately $215,000 by 2036. He also described a bullish scenario of 17% annual returns, implying about $399,000, and a bearish scenario of annual losses of 9.7%, implying about $30,000.

Those assumptions came with substantial risk. According to Consorti, the report assumed annual Bitcoin volatility of 55%, roughly three times that of stocks or gold. Bitcoin was excluded from the main covariance matrix—the model assessing how assets move together to determine portfolio weights—and was instead treated in a separate, smaller model.

Consorti argued that inclusion in the report still mattered for pension funds and other institutional investors. An investment committee member proposing a 1% Bitcoin allocation could cite JPMorgan’s figures, he said, providing an institutional reference for internal allocation discussions.

Trading access and custody infrastructure were also expanding, he said. Charles Schwab had fully launched spot Bitcoin trading for more than 40 million clients and planned to support incoming Bitcoin transfers by year-end. Deutsche Bank planned to launch Bitcoin custody within weeks, starting in Europe before expanding into Asia, according to his account.

Consorti also highlighted BlackRock’s filing for a Bitcoin fund designed to cushion losses for more conservative investors. He said the proposed product would use options on its existing Bitcoin fund to target protection against approximately 90% of losses in exchange for surrendering some upside. Even as institutional research, trading access, custody and risk-management products develop, the decision to allocate capital remains a separate hurdle.