According to TechFlow, on November 7, The Block reported that as Trump won the US presidential election, analysts at JPMorgan Chase expect both gold and Bitcoin to perform well and emphasized the "currency depreciation trade."
The "debasement trade" refers to an investment strategy that benefits from a depreciating or weakening currency, usually due to inflation or expansionary fiscal policy. In this trade, investors buy assets such as gold and Bitcoin, which are seen as stores of value and can maintain their value even if the purchasing power of a currency declines.
"The 'debasement trade' is likely to be reinforced by tariffs, geopolitical tensions, and expansionary fiscal policy ('debt debasement')," the JPMorgan Chase & Co. analyst team, led by managing director Nikolaos Panigirtzoglou, wrote in a note Wednesday. "We do not view gold's initial negative market reaction after Trump's victory as a repudiation of the 'debasement trade.' After all, Bitcoin, another component of the 'debasement trade', rallied after Trump's victory."
When asked if JPMorgan has a price target for Bitcoin in 2025, Panigirtzoglou said, "We are optimistic about Bitcoin in 2025," but declined to provide a specific price target. Analysts pointed out that retail investors are also supporting gold and Bitcoin, and investments in gold and Bitcoin ETFs have increased since last summer.
They added that the trend will continue until 2025, and Trump’s policies could support both assets. In addition to Trump’s policies, analysts said Bitcoin could get a further boost from MicroStrategy, which has unveiled an aggressive Bitcoin acquisition plan through its “21/21 Plan.”
The plan involves raising $42 billion in funds over the next three years, half of which ($21 billion) will come from equity and the other half ($21 billion) will come from fixed income securities. "In 2025 alone, MicroStrategy will invest $10 billion in Bitcoin, which is roughly equal to the total amount it has accumulated since mid-2020," the analyst said.
