On Thursday, JPMorgan analysts released a market strategy note suggesting that the profit-taking on Grayscale's bitcoin ETF (GBTC) had probably come to an end. It said, "The majority of the downward pressure on bitcoin stemming from this source is likely behind us."

Bitcoin mostly traded below $40,000 throughout the week.

JPMorgan had previously estimated that around $3 billion would exit GBTC as investors sought to profit from the ETF's trading below the actual value of bitcoin. 

The study also suggests that approximately $1.3 billion has shifted from GBTC to other spot bitcoin ETFs with lower fees. Analysts argue that this trend of funds moving away from GBTC to competing ETFs is likely to persist if Grayscale does not reduce its fee, currently set at 1.5%, which is considerably higher than the 0.25% charged by rival offerings from Blackrock and Fidelity.

"There appear to be two emerging competitors to Grayscale's bitcoin ETF: Blackrock and Fidelity, which have so far attracted $1.9 billion and $1.8 billion of inflows respectively. They both have much lower fees of only 25 basis points (without waivers) vs 150 basis points for GBTC."

The recent launch of spot bitcoin ETFs in the United States is an emerging influence on bitcoin prices, aligning it more closely with traditional markets like equities. JP Morgan analysts believe that the introduction of spot bitcoin ETFs would make it easier to predict bitcoin behavior. 

"While, at face value, the introduction of spot bitcoin ETFs implies more fragmentation, in practice, it would increase market depth and liquidity if the experience of ETFs in traditional asset classes such as equities is a guide,"


The report anticipates a reduction in selling pressure on bitcoin.


Fri Jan 26 2024

JP Morgan: Grayscale's GBTC Profit-Taking Likely Over

JPMorgan's Crystal Ball: Retail Investors Set To Fuel Bitcoin Boom Before Halving

JPMorgan's Crystal Ball: Retail Investors Set To Fuel Bitcoin Boom Before Halving

Fri Jan 26 2024 JP Morgan: Grayscale's GBTC Profit-Taking Likely Over

JPMorgan's Crystal Ball: Retail Investors Set To Fuel Bitcoin Boom Before Halving

JPMorgan's Crystal Ball: Retail Investors Set To Fuel Bitcoin Boom Before Halving

Fri Jan 26 2024

JP Morgan: Grayscale's GBTC Profit-Taking Likely Over