JP Morgan Predicts Up to $35
Billion Inflows into New Bitcoin
ETFs
According to Coin News, J.P. Morgan has
expressed skepticism about the amount of fresh
capital that new spot bitcoin exchange-traded
funds (ETFs) will attract. In a recent research
report, the bank stated that while the market
reaction to the U.S. Securities and Exchange
Commission's (SEC) approval of spot bitcoin ETFs
has been relatively muted, it does expect
significant funds to rotate from existing crypto
products into the newly created ETFs. Even if no
new capital enters the cryptocurrency market,
the new ETFs could still attract inflows of up to
$36 billion.
P. Morgan estimates that about $3 billion could
exit the Grayscale Bitcoin Trust (GBTC) and
migrate to the new spot ETFs as a result of
investors taking profit after buying discounted
GBTC shares in the secondary market in the last
year. The bank also sees up to $20 billion from
retail investors migrating from digital wallets held
at crypto exchanges to the new ETFs. Grayscale's
high fees could trigger outflows, and unless it
lowers its rates towards the level set by Blackrock
and other providers, an additional $5 billion-$10
billion could exit GBTC relatively quickly to
migrate towards cheaper spot bitcoin ETFs.
Institutional investors that hold their crypto in
fund format could shift from futures-based ETFs
and GBTC to cheaper spot ETFs, especially if
GBTC is slow to cut its fees, the report added.
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