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Since the launch of Spot Bitcoin ETFs, we have been receiving daily inflow and outflow figures. Although these figures fluctuate with Bitcoin prices, there is a noticeable flow into the cryptocurrency market. A recent report by JPMorgan provides striking details about these flows. However, the JPMorgan report also points out a downside.
Comprehensive Bitcoin and Cryptocurrency Report by JPMorgan
According to a recent report by JPMorgan, the cryptocurrency market has seen an inflow of $12 billion so far this year. JPMorgan expects this figure to reach $26 billion by the end of 2024. Despite the inflows, JPMorgan expressed some reservations.
The report, prepared by a team led by analyst Nikolaos Panigirtzoglou, indicates that a significant portion of these inflows actually came from spot Bitcoin ETFs. JPMorgan highlighted that ETFs contributed $16 billion in inflows, suggesting that this could be viewed as a redistribution of funds, especially considering the 220,000 BTC decline on exchanges.
According to JPMorgan’s assessment, the year-end expectation directly drops to around $12 billion. Numerically, this result is quite low compared to the peak institutional inflows during the 2021-2022 period.
Institutional Investors May Operate Independently of the Market
One of the highlighted points in the report is the possibility that institutional investors may operate independently of the market. Considering that the funds flowing into spot Bitcoin ETFs are evaluated with a long-term goal, it appears that institutional investors are not very concerned with Bitcoin’s fluctuations.
On the other hand, there is a belief that the presence of spot Bitcoin ETFs in the market prevents Bitcoin from experiencing sharp declines. Normally, Bitcoin could undergo 50% corrections after halving, but this did not happen in the last halving cycle.
For example, we should have seen Bitcoin drop to the $37,000 level. But it did not. BTC fell to a maximum of $58,000. It did not stay there long either. It quickly recovered and returned to the $70,000 levels. Let’s see what results institutional flows will yield by the end of the year.
