JPMorgan analysts express skepticism about the sustainability of the $12 billion year-to-date inflow into crypto assets, citing high Bitcoin prices relative to its production cost and gold.
This year, the crypto market has seen significant inflows, particularly due to spot Bitcoin exchange-traded funds (ETFs), which have attracted $16 billion. Including CME futures and crypto venture capital funds, total inflows reached $25 billion.
However, much of this inflow is from investors shifting from crypto wallets on exchanges to spot Bitcoin ETFs for better cost-effectiveness, liquidity, and regulatory benefits.
This shift has decreased Bitcoin reserves on exchanges by $13 billion since January. Adjusted for this, the net inflow stands at $12 billion year-to-date.
Analysts doubt this trend will continue, especially given the high Bitcoin prices. They recently revised Bitcoin’s production cost estimate to $45,000 from $42,000.
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