JPMorgan says inflation concerns, not ETFs, driving Bitcoin price jump

Bitcoin’s price has gone up by more than $1,000 in the past week, with JPMorgan Chase CEO Jamie Dimon attributing the increase to “inflation concerns” rather than the prospect of an ETF.

The how will etf affect bitcoin is a question that has been asked for a while now. JPMorgan says that the main reason for the price increase is because of inflation concerns, not ETFs.

 

Following the debut of ProShares’ Bitcoin Strategy exchange-traded fund (BITO) on Tuesday, Bitcoin (BTC) breached its all-time high price level, but JPMorgan Chase analysts think the main reason behind the price rise is investor anxiety about inflation.

According to JPMorgan analysts, the BITO debut, which had the biggest ever first-day natural volume for an ETF, is “unlikely to spark a new phase of substantially more fresh money into Bitcoin.”

Instead, JPMorgan thinks that the current bull run is the result of Bitcoin’s increased position as a stronger hedge against inflation in the eyes of investors, since gold has failed to react to worries about increasing cost pressures in recent weeks. The team said that the move away from gold ETFs and toward Bitcoin funds has been gaining traction since September, and that this “supports a positive view for Bitcoin through the year-end.”

JPMorgan strategists illustrated decreasing interest after the debut of the Purpose Bitcoin ETF (BTCC) in Canada, saying that the early excitement around BITO may similarly wane within a week.

ProShares’ Bitcoin Strategy ETF began trading on the New York Stock Exchange on Oct. 19 at an opening price of $40 per share, making it the first Bitcoin futures-linked ETF in the United States. In a regulated market, it allows investors to have direct exposure to cryptocurrency futures.

In a record-breaking two days, the Bitcoin futures ETF reached $1 billion in assets under management (AUM).

JPMorgan’s remarks are similar to those made by others in conventional finance. As the next market crisis approaches, billionaire investor Carl Icahn hailed Bitcoin as a fantastic inflation hedge.

Bill Winters, the CEO of the British bank Standard Chartered, recently said that “it’s entirely natural for people to seek an alternative to fiat money,” referring to the end of a lengthy era of low inflation.

The kryptoin bitcoin etf trust is a measure of the expected inflation rate over the next 10 years. This has been driving up the price of Bitcoin.

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