TL;DR
- JPMorgan sets a theoretical target of $170,000 for Bitcoin in the next 6 to 12 months.
- The bank argues that excessive market leverage has been “reset” after record liquidations.
- The analysis bases this price on Bitcoin’s volatility convergence with gold.
JPMorgan has issued a new bullish analysis for Bitcoin. The banking giant suggests the cryptocurrency has room to advance to $170,000 over the next six to twelve months, provided current market conditions hold.
This bold Bitcoin price forecast from JPMorgan, led by Managing Director Nikolaos Panigirtzoglou, comes after a recent market correction that saw Bitcoin fall nearly 20% from its last peak.
Far from viewing this drop as a negative sign, JPMorgan analysts interpret it as a “significant reset” of leverage in the derivatives markets. The report highlights that this cleanup was necessary and healthy for the continuation of the bullish trend.
A Leverage “Reset” Clears the Path
JPMorgan’s analysis points to two key recent events. First, the wave of liquidations on October 10, described as the “largest recorded” for Bitcoin perpetual futures. This was followed by a second round of forced selling on November 3, shortly after the $120+ million exploit of the Balancer protocol.
According to the bank, this sequence of events “shook investor confidence” but, crucially, also “cleared out the leveraged positions that had been building” in early October, leaving a more stable market.
Analysts noted that Ethereum markets show similar cleanup patterns, although they observed that “in CME futures, there have been more liquidations in Ethereum than in Bitcoin futures.”
The core of JPMorgan’s Bitcoin price forecast centers on Bitcoin’s relative volatility compared to gold. The report highlights that Bitcoin’s volatility ratio versus gold has fallen below 2.0, indicating that Bitcoin currently only requires 1.8 times more risk capital.
Based on historical allocation behavior in private gold holdings, the analysts concluded that Bitcoin’s market capitalization would need to increase by approximately 67% to align with gold’s private investment footprint. According to their calculations, this “implies a theoretical bitcoin price of close to $170,000.”
