SKN | JPMorgan Holds Firm on $170K Bitcoin Target Even as Market Pullback Deepens

Bitcoin’s recent slide below key psychological levels has done little to shift JPMorgan’s long-standing gold-parity valuation model, with the bank reiterating its $170,000 long-term price target despite escalating market volatility. The reaffirmation comes at a time when macro uncertainty, shifting liquidity conditions, and declining risk appetite have pressured the broader crypto complex. For institutional investors, the call underscores the bank’s continued reliance on structural, not cyclical, drivers in assessing Bitcoin’s potential trajectory.

Market Reaction and Price Dynamics

Bitcoin’s downturn—falling more than 12% over the past two weeks and briefly touching the $88,000–$90,000 range—has amplified near-term caution across leveraged markets. Spot volumes on major exchanges rose roughly 18% week-over-week as traders repositioned amid heightened uncertainty. JPMorgan noted the correction aligns with stretched positioning seen in derivatives markets, where funding rates had climbed to multi-month highs before reversing sharply. Despite this, the bank maintains that Bitcoin’s long-term valuation continues to be influenced by the convergence between its market cap and that of investment gold, which currently stands near $14 trillion. At parity, Bitcoin would need to trade closer to the $170,000 level—almost double current prices.

Macro and Regulatory Considerations

The bank’s analysis also factors in macro trends, particularly the expected normalization of real yields and the trajectory of global monetary policy. With U.S. Treasury yields retreating from their recent peaks and rate-cut expectations firming for 2025, JPMorgan argues that structural demand for alternative stores of value could strengthen. Concurrently, the regulatory backdrop remains mixed: ETF flows have slowed, registering a modest $120 million net outflow over the past week, while stablecoin market caps continue to expand, rising 2.1% month-over-month. This divergence highlights an ecosystem still adjusting to shifting risk frameworks, though not one signaling a collapse in institutional engagement.

Institutional Sentiment and Strategic Positioning

Institutional sentiment toward Bitcoin has softened but remains far from capitulation levels. Data from major custodians show that high-net-worth and institutional accounts reduced BTC exposure by approximately 3–5% in the last month, suggesting strategic rebalancing rather than structural exit. JPMorgan’s renewed target reflects what it sees as a multi-year thesis anchored in Bitcoin’s correlation with gold, its limited supply growth, and steady institutional adoption. Behavioral indicators also point to investors treating the current downturn as cyclical rather than transformational, with long-term wallet cohorts continuing to accumulate at a pace of roughly 30,000 BTC per month.

In the months ahead, the resilience of Bitcoin’s “digital gold” narrative will face renewed tests from liquidity conditions, regulatory rulings, and ETF flow stability. If macro tailwinds strengthen and institutional allocation regains momentum, JPMorgan expects Bitcoin’s valuation trajectory to realign with its gold-linked framework. However, sustained volatility and policy uncertainty remain key risks that could delay that convergence, keeping markets highly reactive to incremental macro and regulatory developments.