Bitcoin Outflows Are Increasingly Choosing Bitcoin Over Gold, Signaling a Preference for Digital Assets, According to JP Morgan

With global markets shifting, investors are increasingly choosing Bitcoin over gold, signalling a preference for digital assets, according to analysts from JP Morgan.

As global macroeconomic trends unfold, investors are increasingly turning to Bitcoin over gold, highlighting a strong preference for digital assets, analysts at JP Morgan have observed.

Earlier this year, a “debasement trade” was in play, with both Bitcoin and gold being used by investors to hedge against weakening fiat currencies in response to inflation and other factors. However, a recent report by JP Morgan, titled ‘Flows & Liquidity: BTC Is Outperforming Gold In Terms Of Investor Flows’, shows that this dynamic has now flipped.

According to Nikolas Panigirtzoglou, Managing Director at JP Morgan, “From mid-February to mid-April this year, the rise in gold prices affected Bitcoin, but in the past three weeks, Bitcoin has been pushing out gold and rising.”

According to the report, gold prices have decreased by nearly 7.9% since reaching their peak on 22 April, while Bitcoin has seen a surge of 17.8% in the past three weeks. This shift in capital flows is also evident in futures markets, where positions in gold have declined while those in Bitcoin have risen.

Moreover, there has been a significant shift in capital from gold exchange-traded funds (ETFs) to Bitcoin and crypto funds.

Recently, a series of crypto-specific catalysts have been identified by JP Morgan as key drivers of Bitcoin’s recent price momentum. These include:

• The launch of several new Bitcoin exchange-traded products (ETPs) in Europe.

• Growing institutional interest in cryptocurrencies, especially from large hedge funds.

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