In the world of cryptocurrencies, Ethereum and other altcoins continue to lag behind Bitcoin‘s performance. According to JPMorgan’s latest research, both Ethereum’s price action and institutional investment flows have consistently trailed Bitcoin since the broad market risk reduction phase that began in October 2025.
Clear gap grows between Ethereum and Bitcoin
Throughout 2024, global markets remained under pressure due to inflation concerns and reduced risk appetite. However, Bitcoin staged a notably swift recovery. The research team, led by JPMorgan’s managing director Nikolaos Panigirtzoglou, pointed out that the gap between the two leading cryptocurrencies has widened, especially as institutional investors show stronger preference for Bitcoin. While spot Bitcoin ETFs have recaptured around two-thirds of past outflows, spot Ether ETFs managed to recover only about one-third of theirs.
To put this gap into perspective, here’s a summary comparison of ETF inflow performance:
| Asset | ETF Capital Recovered |
|---|---|
| Bitcoin | Approximately 66% |
| Ethereum | Around 33% |
Institutional investors and network upgrades
JPMorgan’s analysis shows that major investment organizations, such as crypto index funds and commodity advisors, have scaled back their positions in both Bitcoin and Ethereum.
Looking ahead, Ethereum’s prospects hinge on significant scalability upgrades like Glamsterdam and Hegota scheduled for next year. However, analysts remain cautious, noting that previous network upgrades have struggled to deliver substantial on-chain usage growth.
Glossary: An ETF (Exchange Traded Fund) is a financial product that represents an asset or a basket of assets as a tradeable share on stock exchanges. In spot ETFs, the underlying asset is held physically, allowing price movements to be mirrored exactly in the fund’s value.
DeFi’s trust challenges with institutions
A separate JPMorgan report highlights how recurring security flaws in decentralized finance (DeFi) continue to deter institutional capital. Traditional financial institutions remain wary of entering the DeFi ecosystem, as individual breaches can quickly trigger broader liquidity swings.
JPMorgan analysts emphasized that “repeated security breaches have significantly constrained the allocation of capital from major institutions representing traditional finance in the DeFi ecosystem.”
Corporate Bitcoin purchases take center stage
The research team also underscored the scale of recent major corporate investments in Bitcoin. MicroStrategy, which has rebranded as Strategy, stands out for its ongoing BTC accumulation. According to JPMorgan estimates, if the company maintains its current pace, it could reach $30 billion in Bitcoin purchases by 2026.
MicroStrategy, a Nasdaq-listed enterprise software firm, has long been notable for holding substantial amounts of Bitcoin on its balance sheet. Its aggressive buying policy frequently serves as a prominent example in the market.
