A sharp decline in Bitcoin’s volatility is fundamentally reshaping its investment case, with JPMorgan analysts now arguing the cryptocurrency is significantly undervalued compared to gold. The bank’s latest research reveals Bitcoin’s six-month realized volatility has been cut in half, plunging from 60% earlier this year to a record low of just 30%.
A sharp decline in Bitcoin’s volatility is fundamentally reshaping its investment case, with JPMorgan analysts now arguing the cryptocurrency is significantly undervalued compared to gold. The bank’s latest research reveals Bitcoin’s six-month realized volatility has been cut in half, plunging from 60% earlier this year to a record low of just 30%.
This historic compression means Bitcoin now trades at only twice the volatility of gold, the narrowest gap ever recorded. The shift signals that the digital asset may require far less risk capital than in the past, strengthening its appeal for institutional portfolios.
The is central to JPMorgan’s argument. On a volatility-adjusted basis, the analysts estimate Bitcoin’s market cap would need to climb by 13% to match the $5 trillion invested in private gold holdings.
Bitcoin (BTC) price prediction
BTC price remains stuck near $113K
Besides valuation, the declining volatility has broader implications. With Bitcoin behaving more like a mature financial asset, it is becoming increasingly appealing for long-term portfolio strategies.
Consequently, institutions may begin allocating more capital as the risk-reward profile narrows toward traditional assets like gold. Companies gaining index inclusion, such as Metaplanet’s recent upgrade to FTSE Russell’s mid-cap category, are bringing in passive investment flows.
Similarly, Nasdaq-listed Kindly MD is preparing to raise $5 billion after an earlier $679 million Bitcoin purchase, which shows how corporate balance sheet strategies are evolving. New players are also entering the race, with Adam Back’s firm now positioning itself against giants like MicroStrategy, reinforcing the narrative that Bitcoin has moved far beyond speculative demand.
