JPMorgan Said Bitcoin Was Overvalued Compared to Gold in 2024. Now They Say It Is Worth $170,000

Updated May 2, 2026

In early 2024, Nikolaos Panigirtzoglou and his team at JPMorgan published a report arguing that Bitcoin at $66,000 was already trading above its fair value when compared to gold on a risk-adjusted basis. Their model suggested Bitcoin should be closer to $45,000. The conclusion was that expectations for Bitcoin to match gold’s role in investor portfolios were unrealistic given how much more volatile it was.

Two years later, the same analyst using the same framework has a very different conclusion.

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JPMorgan now says Bitcoin’s fair value is approximately $170,000. Not as a price prediction. Not as a target based on momentum or sentiment. As a mechanical calculation using the same gold-parity model that in 2024 suggested Bitcoin was overpriced by a third.

What changed between then and now is worth understanding carefully, because it tells you something real about how Bitcoin is maturing as an asset.

The Model and What It Measures

JPMorgan’s gold-parity framework is straightforward in principle. It asks: if institutional investors treated Bitcoin the same way they treat gold when building portfolios, what price would Bitcoin need to reach for the two assets to have equivalent risk capital allocation?

The key variable is the volatility ratio between Bitcoin and gold. Investors do not size positions by dollar amount, they size them by risk. If you are willing to put 5% of your portfolio in gold, and Bitcoin is three times more volatile than gold, then a risk-equivalent Bitcoin allocation would be roughly 1.7%. So Bitcoin’s total market cap would need to be proportionally smaller than gold’s private investment market to represent the same risk capital.

In 2024, Bitcoin’s volatility was approximately 3.7 times higher than gold’s. That high volatility ratio meant that even at $66,000, Bitcoin’s market cap implied an overallocation relative to gold on a risk-adjusted basis. The model said sell.

By late 2025 and into 2026, that volatility ratio had fallen to approximately 1.8. Bitcoin has become significantly less volatile relative to gold as the ETF market matured, institutional participants increased, and the asset class developed more sophisticated trading infrastructure.

At a 1.8 volatility ratio, the gold-parity math produces a very different result. With approximately $6.2 trillion in private gold investment globally through ETFs, bars, and coins, JPMorgan’s model suggests Bitcoin’s market cap would need to grow by roughly two-thirds from its current level to match that exposure on a risk-adjusted basis. That implies a Bitcoin price of around $170,000.

What Happened to Gold in the Meantime

The other half of the equation is that gold itself moved dramatically. Gold hit a record high of $5,589 per ounce in January 2026 and remains up around 80% since the start of 2025. The US-Iran conflict that began in late February, sustained central bank buying, and sticky inflation all drove gold’s historic run.

Bitcoin did not follow. Bitcoin peaked at $126,000 in October 2025 and has been correcting since, sitting around $78,000 today. Gold surged while Bitcoin pulled back.

That divergence matters for the JPMorgan model in two ways. First, it expanded the private gold investment base that Bitcoin is being compared against, pushing the implied fair value higher. Second, it demonstrated something that JPMorgan’s analysts pointed out explicitly: Bitcoin now thrives when liquidity is expanding rather than just when fear is rising. When one asset zigs, the other zags.

Bitcoin and gold are no longer correlated. They are moving on different drivers. Gold responds to crisis and central bank demand. Bitcoin responds to liquidity conditions and risk appetite. The correlation between them dropped to approximately -0.88 in early 2026, its lowest level since 2022.

JPMorgan analysts, led by Panigirtzoglou, wrote that gold has outperformed Bitcoin since last October, but with sharply higher volatility, which makes Bitcoin “even more attractive compared to gold.” In theory, if Bitcoin were to match the recent volatility seen in gold, the price of the digital asset would have to rise to near $266,000. The analysts called that figure unrealistic in the near term but noted it illustrates the long-term upside potential.

Why the ETFs Changed Everything

In 2024, JPMorgan was skeptical about whether Bitcoin ETF inflows represented genuinely new money entering the space or just rotation from existing instruments. They projected $62 billion in ETF inflows over two to three years and called that ambitious.

BlackRock’s iShares Bitcoin Trust has amassed over $80 billion in assets, reflecting a 64% increase in institutional exposure to Bitcoin this year. The ETF projections were not ambitious. They were conservative.

The ETF structure changed who could hold Bitcoin and how. Institutions that previously could not buy Bitcoin directly because of custody rules, compliance requirements, or board mandates can now hold it through the same infrastructure they use for everything else. That structural shift is what drove the volatility ratio down. More patient, longer-term institutional capital means fewer panic sells, smoother price discovery, and a less volatile asset.

This is the mechanism JPMorgan identified. The maturation of Bitcoin’s holder base, enabled by the ETF structure, is the reason the same gold-parity model that pointed to overvaluation in 2024 now points to significant undervaluation in 2026.

The Barbell Portfolio

Institutional allocators have started putting Bitcoin and gold in separate buckets. Strategists are increasingly moving to what is called the barbell approach: gold for 10 to 15% of a portfolio as genuine crisis insurance, low volatility, protection against war and currency collapse, and Bitcoin for 5 to 10% as a high-upside bet on liquidity expansion, technology adoption, and regulated ETF flows.

This is a significant shift from the dominant framing of even two years ago, when Bitcoin and gold were treated as competing safe-haven assets and analysts debated which one would win. The current view is that they serve fundamentally different purposes and can coexist in the same portfolio without redundancy. The negative correlation between them actually makes the combination more efficient from a risk-management perspective.

JPMorgan’s $170,000 fair value estimate is not a prediction that Bitcoin will reach $170,000 on any particular timeline. It is a statement about where the model says Bitcoin should trade if markets were fully pricing its risk-adjusted relationship to gold. Whether that gap closes depends on whether the negative sentiment that has weighed on Bitcoin through 2026 reverses, on whether the macro environment turns favorable, and on whether institutional demand continues growing.

What is not in question is that the analytical framework leading banks use to evaluate Bitcoin has fundamentally changed. In 2024, Bitcoin was analyzed as a speculative asset being compared unfavorably to a monetary one. In 2026, it is being analyzed as a monetary asset in its own right, with its own distinct role in institutional portfolios and its own fair value derived from that role.

The bank that said $45,000 two years ago now says $170,000. The model did not change. Bitcoin did.

Updated May 2, 2026

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