JPMorgan: Bitcoin Traders Likely to Unwind Futures Positions
Bitcoin trades are more likely to unwind their futures position citing a slowdown in Bitcoin institutional participation, says JPMorgan!
Just as Bitcoin (BTC) continues to face downward pressure over the last week, the institutional interest also seems to wane down at the moment. JPMorgan analysts think that Bitcoin price return to $40,000 seems to be doubtful as to the institutional inflows to the biggest Bitcoin fund – Grayscale Bitcoin Trust (GBTC) – seem to be slowing down.
JPMorgan strategists led by Nikolaos Panigirtzoglou noted that the GBTC four-week rolling average “appears to have peaked”. As per the last Grayscale update, the net assets under management (AUM) of its Bitcoin Trust has dropped to $20.4 billion.
JPMorgan states that fund slid is faster at 22% whereas the BTC price has dropped 17% during the same period.
The analysts also added that as institutional inflows slow down, Bitcoin traders are likely to unwind their positions. The strategists wrote:
“At the moment, the institutional flow impulse behind the Grayscale Bitcoin Trust is not strong enough for Bitcoin to break out above $40,000″. They added: the “risk is that momentum traders will continue to unwind Bitcoin futures positions. The near-term balance of risks is still skewed to the downside”.
Recently, Grayscale has, however, resumed back to Bitcoin buying. As per data on Bybt, the Grayscale Bitcoin Trust (GBTC) has purchased more than 40K Bitcoin since January 14, 2021, pouring more than $1.5 billion.
Institutions Are Scooping Whale Bitcoins
In another analysis, long term Bitcoin holders called “whales” and miners have been losing their supplies to institutions over the last year. Adam James with OKEx Insights told Bloomberg:
“Old-school Bitcoiners sold some of their old bags to new institutional buyers with extremely large new bags to fill”.
Below is the chart that clearly shows how Bitcoin (BTC) holding among Asian whales and miners is dropping since March 2020 and how U.S.-based institutions have accumulated during the same period.
- FOMC Meeting: Fed Makes First Rate Cut of the Year, Lowers Rates by 25 Bps
- “Beyond a Centralized Exchange” Bitget CEO Unpacks Universal Exchange Vision on 7-Year Anniversary
- Breaking: CME Group to Launch Solana and XRP Futures Options as Institutional Demand Grows
- Franklin Templeton CEO Dismisses 50bps Rate Cut, Citing ‘Robust Economy’ Ahead of FOMC
- Bitget Unveils ‘Universal Exchange’ Era to Mark 7-Year Anniversary
- Shiba Inu Price Set to Soar as Exchange Reserves Dive Amid SHIB ETF Chatter
- Pepe Coin Price Prediction as Whale Moves $25M From Robinhood- Is a Breakout to $0.00002 Next?
- XRP Price Prediction as Market Longs Hit 78% amid VivoPower Treasury Expansion Launch — Is $4 Next?
- SHIB Price Forecast: Taker Buys Lead as Developers Counter Shibarium Exploit
- Solana Price Set for a 25% Jump as Open Interest Nears a $20 Billion Milestone
- Bitcoin Price Prediction as Fed Decision Nears — Dump Before the Next Rally?
Why Trust CoinGape
CoinGape has covered the cryptocurrency industry since 2017, aiming to provide informative insights Read more…to our readers. Our journal analysts bring years of experience in market analysis and blockchain technology to ensure factual accuracy and balanced reporting. By following our Editorial Policy, our writers verify every source, fact-check each story, rely on reputable sources, and attribute quotes and media correctly. We also follow a rigorous Review Methodology when evaluating exchanges and tools. From emerging blockchain projects and coin launches to industry events and technical developments, we cover all facets of the digital asset space with unwavering commitment to timely, relevant information.
Premium Partners
