JPMorgan Says Inflation-Hedge Demand for Bitcoin, Gold Is Weakening
Forecast Trend Report by Period
JPMorgan says demand for Bitcoin and gold as inflation hedges has weakened broadly.
The Block reported on June 11 that the bank sees outflows from gold ETFs, while spot-Bitcoin ETFs have posted net outflows for four straight weeks.
Institutional investors have also continued to scale back Bitcoin- and gold-related positions in the futures market.
JPMorgan said buying interest in Bitcoin and gold, previously supported by geopolitical uncertainty, inflation concerns, rising government debt and the potential for a weaker dollar, has slowed recently.
The bank added that weaker investment demand for both assets as inflation hedges has reduced momentum for fresh inflows.
Still, JPMorgan is not entirely bearish on the crypto market over the medium to long term.
It said key catalysts for a rebound in the second half could include resolving uncertainty over dividend funding at companies that hold digital assets, as well as passage of the CLARITY Act, a US digital-asset regulatory bill.
With spot-Bitcoin ETF outflows continuing and institutional demand softening, changes in the regulatory environment and institutional fund flows are emerging as key factors that will shape the market's next direction.
