Bitcoin Is Starting To Outperform Gold: JPMorgan

After rising in tandem last year as hedges against currency depreciation, Bitcoin BTC/USD and gold are no longer moving in sync.

What Happened: According to JPMorgan, the two assets have entered a zero-sum phase in 2025, with gains in one increasingly coming at the other's expense, The Block reported.

JPMorgan analysts, led by managing director Nikolaos Panigirtzoglou, noted a reversal in capital flows in recent months.

From mid-February to mid-April, gold outperformed while Bitcoin lagged.

But since late April, the trend has flipped: Bitcoin has climbed 18% while gold has dropped nearly 8%.

Investor flows and futures data support this divergence, with capital leaving gold ETFs and entering Bitcoin funds.

The bank's strategists expect this competitive dynamic between the two assets to persist through the remainder of the year, though they see more potential upside for Bitcoin.

“We are biased towards crypto-specific catalysts creating more upside for Bitcoin over gold into the second half of the year,” the note said.

One major factor behind Bitcoin's rise is increased institutional and public sector adoption.

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Why It Matters: U.S. states are also starting to allocate to Bitcoin.

New Hampshire now permits up to 5% of state assets in Bitcoin and gold, and Arizona is establishing a digital asset reserve fueled by staking yields and token airdrops, while pledging to hold taxes steady.

These developments signal growing acceptance of Bitcoin as a strategic reserve asset.

JPMorgan believes this trend may become more significant if more states follow suit.

At the same time, structural changes in the crypto derivatives market are boosting investor confidence.

Coinbase's COIN acquisition of Deribit, Kraken's purchase of NinjaTrader, and Gemini's expansion into European derivatives licensing are seen as milestones that could usher in greater institutional engagement, particularly as regulatory clarity improves.

Altogether, with gold under pressure and Bitcoin buoyed by sector-specific growth, JPMorgan sees the second half of the year tilting in favor of the leading cryptocurrency.

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