JPMorgan says GBTC outflows stemmed, bitcoin downside ‘should be largely behind us’

Analysts at the firm noted bitcoin open interest, ETF inflows are rising again


JPMorgan CEO Jamie Dimon | lev radin/Shutterstock modified by Blockworks


JPMorgan analysts penned a market strategy note Thursday that profit-taking on Grayscale’s bitcoin ETF (GBTC) had likely concluded, thus “limiting any downside for bitcoin from here.”

The analysis from JPMorgan would amount to a reversal of fortunes for bitcoin and its largest spot ETF. It follows a Tuesday note from JPMorgan claiming that the ETF catalyst would “disappoint market participants.”

Newly-approved spot bitcoin ETFs logged their single largest day of outflows Wednesday. Investors cashed out on $429 million worth of GBTC, bringing the product’s total outflows to roughly $4.4 billion in nine days of trading.

Bitcoin has spent much of the week trading below $40,000 after topping $49,000 in the immediate aftermath of the ETF approvals.

Read more: Spot bitcoin ETF net outflows hit highest level yet on day 9 of trading

JPMorgan previously estimated $3 billion would depart GBTC as investors took profit on the ETF trading below the value of bitcoin, the note said. The FTX estate was reportedly among the investors selling their GBTC.

The group of analysts, led by Nikolaos Panigirtzoglou, think the GBTC sell-off has concluded and “most of the downward pressure on bitcoin from that channel should be largely behind us.”

The note estimates another $1.3 billion shifted from GBTC to other spot bitcoin ETFs with lower fees. The analysts argue the shift in funds from GBTC to competing ETFs will likely continue if Grayscale fails to lower its fee of 1.5%, which is much higher than the 0.25% charged by competing offerings from Blackrock and Fidelity.

The note’s appendix shows upticks in open interest and bitcoin fund flows on Tuesday. Bitcoin open interest is up a little under 1% in the past 24 hours, according to data from Coinglass. 

Earlier this week, JPMorgan downgraded the stock of popular bitcoin ETF custodian Coinbase following underwhelming week one performance from the slew of spot ETFs.

Start your day with top crypto insights from David Canellis and Katherine Ross. Subscribe to the Empire newsletter.

Explore the growing intersection between crypto, macroeconomics, policy and finance with Ben Strack, Casey Wagner and Felix Jauvin. Subscribe to the On the Margin newsletter.

The Lightspeed newsletter is all things Solana, in your inbox, every day. Subscribe to daily Solana news from Jack Kubinec and Jeff Albus.


Upcoming Events

Salt Lake City, UT

MON - TUES, OCT. 7 - 8, 2024

Blockworks and Bankless in collaboration with buidlbox are excited to announce the second installment of the Permissionless Hackathon – taking place October 7-8 in Salt Lake City, Utah. We’ve partnered with buidlbox to bring together the brightest minds in crypto for […]

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research



Aerodrome is a "MetaDEX" that combines elements of various DEX primitives such as Uniswap V2 and V3, Curve, Convex, and Votium. Since its launch on Base, it has become the largest protocol by TVL with more than $495M in value locked, doubling Uniswap's Base deployment.


And a look into the newest name on the Trump ticket: Sen. JD Vance


Plus, Imran Khan’s intriguing experiment on the speeds of crypto onramps


The SEC has signaled a timeline to issuers that could lead to a July 23 launch for the ETH funds, people close to the process told Blockworks


PayPal has unequivocally made a name for itself as a crypto adopter among fintech giants


Also, a look into how the highly-debated SAB 121 could end up shaking out for crypto custodians


Vance, an Ohio Republican, is largely seen as crypto-friendly