Bitcoin (CRYPTO: BTC) broke above $120,000 in Thursday trading as JPMorgan Chase (NASDAQ:JPM) raised its year-end price target to $165,000.
What Happened: JPMorgan analysts now project Bitcoin could climb to $165,000 by the end of 2025, citing its undervaluation compared to gold on a volatility-adjusted basis as reported by The Block.
The BTC-to-gold volatility ratio has slipped below 2.0, suggesting Bitcoin would need to rise about 42% to reach parity with private gold investment levels.
This marks a reversal from late 2024, when Bitcoin was deemed overvalued by $36,000 as opposed to being undervalued by $46,000 now.
Analysts attribute the upside to a retail-led "debasement trade," with investors pouring into Bitcoin and gold ETFs as hedges against deficits, inflation, central bank credibility concerns, and weakening fiat currencies, particularly in emerging markets.
Institutions remain more active in CME futures, but ETF data shows retail dominance.
Gold's rally has further highlighted Bitcoin's relative value, prompting JPMorgan to raise its August target from $126,000 to $165,000.
Also Read: Bitcoin Hits 2-Month At $118,000 High, Ethereum, XRP, Dogecoin Rocket Higher
Why It Matters: Bitcoin ETFs attracted $675.8 million inflows on Oct. 1, led by BlackRock's (NASDAQ:IBIT) ($405.5 million) and Fidelity's (NYSE:FBTC) ($179.3 million).
Open interest surged to $80.4 billion, it’s highest since mid-September, signaling stronger institutional hedging.
The move coincides with U.S. government shutdown headlines, which could delay new ETF approvals. ETFPrime host Nate Geraci noted a "prolonged shutdown would definitely impact the launch of new spot crypto ETFs."
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