Bitcoin’s Inflation Narrative More Compelling Than ETF Fever, JPM Says

The Wall Street bank is trying to pinpoint the fuel behind bitcoin’s latest rally.

AccessTimeIconOct 21, 2021 at 10:18 p.m. UTC
Updated May 11, 2023 at 3:22 p.m. UTC
10 Years of Decentralizing the Future
May 29-31, 2024 - Austin, TexasThe biggest and most established global hub for everything crypto, blockchain and Web3.Register Now

This week’s launch of the ProShares Bitcoin Strategy Exchange-Traded Fund (BITO) may have aided the cryptocurrency’s recent price surge to an all-time high, though the perception of bitcoin as an inflation hedge over gold is probably a bigger factor, a JPMorgan strategist wrote Thursday.

  • In its first two days of trading, BITO amassed assets of over $1 billion, according to ProShares.
  • Bloomberg ETF analyst Eric Balchunas said the new ProShares futures-focused fund is the fastest in the history of the ETF industry to reach $1 billion in two sessions. Such an ascent eclipsed the SPDR Gold Trust (GLD) ETF’s 18-year record at three days to reach this level.
  • JPMorgan strategist Nikolaos Panigirtzoglou wrote in a note to clients there has been a shift from gold ETFs into bitcoin funds since September, and there are already existing vehicles for investors to gain bitcoin exposure. The bank sees this shift in flows being bullish for bitcoin into year’s end.
  • BITO had trading volume of over 29 million shares Wednesday, representing over $1.2 billion, according to a representative from the company.
  • Separately, billionaire investor Paul Tudor Jones told CNBC earlier this week he currently prefers bitcoin over gold as an inflation hedge.

Disclosure

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk offers all employees above a certain salary threshold, including journalists, stock options in the Bullish group as part of their compensation.

Author placeholder image

Michael Bellusci is CoinDesk's crypto reporter focused on public companies and digital asset firms.


Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.