© Reuters. Are investors switching from gold to bitcoin? JPMorgan responds
The combination of outflows from gold exchange-traded funds (ETFs) so far this year and significant inflows into ETFs is raising questions about whether investors are diverting their funds from bullion to the world's largest cryptocurrency.
Driven by strong interest in spot Bitcoin ETFs, BTC funds have seen an inflow of $10.6 billion so far this year, compared to $7.6 billion in outflows from physical gold ETFs.
However, JPMorgan strategists believe this is not the case when investors are transferring funds from gold to Bitcoin.
“We disagree and instead believe that private investors and individuals have propagated both gold and bitcoin to date rather than moving from the former to the latter,” the analysts said in a note.
Analysis of ETF flows alone can offer a misleading perspective, potentially underestimating the acquisition of gold by individuals and private investors through bars and coins, while overestimating their investment in Bitcoin.
JPMorgan strategists highlighted a notable trend in which retail investors are moving from holding Bitcoins in digital wallets “to the convenience and regulatory protection of new spot bitcoin ETFs.”
“Beyond retail investors, speculative institutional investors such as hedge funds, including momentum traders such as CTAs, also appear to have spread the rally by buying gold and bitcoin futures since February, perhaps even more so than retail investors. “the analysts wrote.
