JPMorgan: The tide of "currency devaluation trades" in Bitcoin is accelerating

J.P. Morgan analysts indicate that investors are continuously withdrawing from the so-called "currency devaluation trades," with gold-related allocations continuing to decline, while the pace of Bitcoin's retreat has further accelerated recently.

The report notes that for the week ending June 5, approximately $20 billion flowed out of gold ETFs; Bitcoin ETFs have seen a gradual increase in outflows for four consecutive weeks. In the futures market, institutional investors are also reducing their exposure to gold and Bitcoin, indicating that both retail and institutional funds are lowering their allocations against inflation, currency devaluation, and geopolitical risks.

J.P. Morgan believes that Bitcoin had previously become a primary expression of "currency devaluation trades" since the Middle East conflict, but it has reversed since early May and has further weakened recently. Meanwhile, the decline in liquidity in the ETF and futures markets has also amplified Bitcoin's price correction.

Analysts added that whether the crypto market can improve in the second half of the year still depends on two key factors: whether crypto treasury companies can provide clearer arrangements for dividend payments, and whether the U.S. Clarity Act can be approved.