JPMorgan adds Bitcoin to long-term outlook with high return and risk warnings

JPMorgan Asset Management has added Bitcoin to its long-term capital market assumptions for the first time. The firm predicts that Bitcoin will deliver yearly returns of 10 percent over the next ten years. At the same time, the asset manager warns of a high price swing rate of 55 percent. This large price instability may make Bitcoin less attractive when weighed against safer, traditional investments. Even with the strong predicted returns, JPMorgan has left Bitcoin out of its main portfolio models due to its unstable nature.

Context

Financial firms regularly build long-term outlooks to help guide how money is invested over many years. Assets that swing wildly in price often require extra care from investors who want to protect their money from sudden losses. Cryptocurrencies remain a subject of debate among large traditional banks as they try to balance high possible gains against heavy risks.