JPMorgan says both Bitcoin and gold should benefit from Trump’s victory

Key Takeaways

• JPMorgan predicts both Bitcoin and gold will benefit from Trump's victory as part of the 'debasement trade'.
• Retail investor interest in Bitcoin and gold is increasing, with continued investment expected into 2025.

Bitcoin and gold are expected to benefit from Donald Trump’s presidential victory as part of the “debasement trade,” according to JPMorgan analysts, as first reported by The Block.

The debasement trade is an investment strategy that capitalizes on currency devaluation due to inflation or fiscal policies. Investors buy assets like gold and bitcoin, viewed as stores of value that retain worth despite declining purchasing power.

JPMorgan analysts, led by managing director Nikolaos Panigirtzoglou, wrote in a Wednesday report that the debasement trade “is likely to be reinforced by both tariffs and geopolitical tensions as well as an expansionary fiscal policy.”

Bitcoin reached an all-time high above $76K on Nov. 6 following Trump’s victory confirmation. According to Panigirtzoglou, the firm sees Bitcoin as a positive asset as the year comes to a close.

The analysts expect central bank gold purchases to play a crucial role in determining gold prices through 2025.

They noted that central banks significantly increased gold holdings in 2022 following the Ukraine war and Russian sanctions.

JPMorgan analysts expect ongoing tariffs and geopolitical tensions to drive further central bank diversification from dollar reserves into gold.

Retail investors have shown increased interest in both assets, with rising investments in gold and Bitcoin ETFs since last summer.

The analysts noted this trend is expected to continue into 2025, supported by Trump’s policies.

Additionally, MicroStrategy’s new 21/21 plan could provide additional support for Bitcoin prices, the report noted.

The company plans to raise $42 billion over three years, split equally between equity and fixed-income securities, with $10 billion allocated for Bitcoin purchases in 2025 alone.