Bitcoin’s potential as a key player in institutional investment portfolios is on the rise, according to recent research by Bitwise Asset Management. The firm’s Long-Term Capital Market Assumptions (LTCMAs) preview forecasts an average compound annual growth rate (CAGR) of 28% for Bitcoin over the next decade, with decreasing volatility. This shift positions Bitcoin not as a speculative asset but as a maturing investment option increasingly viewed as a core portfolio component. Bitwise’s Chief Investment Officer, Matt Hougan, highlighted the pivotal moment in 2024 when spot Bitcoin exchange-traded funds (ETFs) were introduced, prompting significant interest from major investment platforms and allocators. Financial institutions, such as JPMorgan and BlackRock, rely on long-term capital market assumptions to guide their portfolio strategies. For the first time in 2025, these institutions are actively seeking to incorporate Bitcoin into their frameworks, marking a significant shift in perception from a peripheral to a core asset. The growing institutional interest in Bitcoin is evident with a notable increase in inquiries about its long-term potential. This shift is attributed to the improved accessibility through regulated ETFs and approval by major account platforms managing substantial client assets. Bitwise underscores the gradual journey of Bitcoin towards institutional acceptance, driven by regulatory clarity and infrastructure enhancements. The introduction of spot ETFs in early 2024 opened doors for traditional allocators, paving the way for Bitcoin’s integration into professional investment strategies incrementally. Looking ahead, Bitwise projects that Bitcoin will not only outperform but also differentiate itself from traditional assets in terms of expected returns. With a forecasted 28.3% CAGR over the next decade, Bitcoin’s performance surpasses the long-term projections for equities, bonds, and private credit by established Wall Street institutions. Despite anticipated continued volatility compared to other asset classes, Bitwise foresees a gradual decrease as market depth and liquidity improve. The implications of Bitcoin’s projected performance extend beyond financial returns, potentially influencing the structuring of balanced portfolios for institutions managing pensions, endowments, and wealth. While acknowledging existing risks, the LTCMAs provide a strategic foundation for professional allocators to make informed decisions rather than speculative bets on Bitcoin’s future trajectory.
Bitcoin Predicted to Outperform Traditional Assets, Gaining Institutional Recognition
