JPMorgan analysts concerned on crypto market as BlackRock Bitcoin ETF has first days of outflows

The crypto market can expect short term turmoil according to analysts of the large American bank JPMorgan. Multiple market developments are hinting at a slump in cryptocurrency interest which will likely lead to lower prices. A big influence is the decreasing interest in Bitcoin (BTC) Spot Exchange Traded Funds (ETFs) which have seen hundreds of millions of dollars in outflows in the past weeks. 

Cryptocurrencies have had a volatile couple of weeks as many altcoins experience a big drawdown from their local tops in March and early April. Although the Bitcoin Halving happened, which occurred on 20th of April, prices haven’t reacted as much to the important event as investors would have liked. 

Catalysts for pessimistic Crypto Market outlook

JPMorgan analysts discuss a variety of market developments that motivate a further slump of BTC and altcoin prices in the short term. A large reason is the lack of retail investor interest which historically is an important part of a bull rally. As the BTC prices reach a new all time high new investors step into the market which drives the prices further up. With the limited influence of retail investors the analysts expect further difficulty for cryptocurrency prices. 

At the same time institutional interest seems to dwindle as a variety of BTC ETFs see millions of dollars in outflows after their explosive run early in the year. BlackRocks ETF, IBIT, saw its first ever day with outflows, which constituted $36.9 million exiting the fund. Other popular ETFs such as Fidelities FBTC lost another $191 million resulting in a net outflow of over $560 million in just one day. The outflow of capital results in a large sell off of BTC and further price decreases. As the analysts of JPMorgan further highlight in their research: 

“With a lack of positive catalysts, with the retail impulse dissipating and with the three headwinds mentioned previously in our publication (elevated positioning, high bitcoin prices vs. gold and vs. the estimated bitcoin production cost, subdued crypto VC funding) still in place, we maintain a cautious stance on crypto markets over the near term.”

Bitcoin price up as market optimistic on rate hikes

BTC price shoots back up above $60.000 levels after new job reports in the United States. The United States economy added 175.000 jobs in April while the Wall Street consensus estimated a 240.000 job gain. At the same time unemployment rates increased from 3.8% to 3.9%. With the economy getting hit harder than expected hopes arise of a rate cut this year which led to an explosive rally ov crypto prices, with bitcoin jumping by 9,1% in mer 24 hours.






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