Bitcoin overtakes gold in investor portfolio allocation — JPMorgan

Mar 15, 202413:10 UTC

Bitcoin has now overtaken gold in investor portfolio allocation when adjusted for volatility, according to a JP Morgan analyst

JPMorgan managing director Nikolaos Panigirtzoglou reportedly said that, when adjusting for volatility, Bitcoin BTCUSD allocation in investor portfolios is 3.7 times greater than gold.

The analyst highlighted the significant inflows of over $10 billion into spot Bitcoin exchange-traded funds (ETFs) since their approval in January and claimed the potential Bitcoin ETF market size could reach $62 billion, using gold as a benchmark.

Another report from JPM Securities predicts that the spot Bitcoin ETFs market could grow as large as $220 billion in the next two to three years:

“We estimate $220B of incremental flows will come into the ETFs over the next three years, which could also be quite impactful to Bitcoin’s price given the multiplier on capital.”

Bitcoin ETFs have proven to be a net positive for the crypto market, with the world’s largest cryptocurrency gaining over 45% in market cap in February. Net sales for spot Bitcoin ETFs climbed to $6.1 billion in February, compared to $1.5 billion in January.

The largest daily inflows to the spot Bitcoin ETFs peaked at over $1 billion on March 12, and analysts believe this number could rise further once outflows from the Grayscale Bitcoin Trust ETF stop.

With the Bitcoin halving just over a month away, the supply of daily BTC would be cut down in half, which could fuel the demand further and lead to a supply crisis within the next six months, predicts Ki Young Ju, the CEO of crypto analytic firm CryptoQuant.

After a prolonged crypto winter lasting nearly three years, spot Bitcoin ETF approvals became a catalyst for BTC’s mammoth price action that has pushed it past the last bull cycle’s all-time high of above $69,000, as well as opening the doors to institutional adoption led by the world’s largest asset manager, BlackRock.