JPMorgan Warns of Bitcoin Selloff as Grayscale Sees $3 Billion Outflow

JPMorgan Analyst Predicts Looming Bitcoin Selloff

Global investment bank JPMorgan has issued a warning about an anticipated outflow from Grayscale's bitcoin fund, stating that it will "exert further pressure on bitcoin prices in the coming weeks." The bank's analyst, Nikolaos Panigirtzoglou, also explained that the $3 billion influx into new spot bitcoin exchange-traded funds (ETFs) is likely due to a shift from existing bitcoin investment vehicles or a move by retail investors from digital wallets held with exchanges/retail brokers to more cost-effective spot bitcoin ETFs.

Concerns Over Bitcoin Price Decline

JPMorgan analyst Nikolaos Panigirtzoglou recently shared his outlook on the price of bitcoin, specifically addressing the impact of the launch of spot bitcoin exchange-traded funds (ETFs) and the outflows from Grayscale's bitcoin fund. Grayscale converted its bitcoin trust (GBTC) into a spot bitcoin ETF after receiving approval from the U.S. Securities and Exchange Commission (SEC), along with 10 other funds, on January 10.

"The price of bitcoin has dropped by over 10% since the launch of spot bitcoin ETFs last week," described the JPMorgan analyst. "It seems that profit-taking, which follows the 'buy the rumor, sell the fact' principle, has occurred in recent days as we had previously anticipated. The price of BTC surged past $47,000 in anticipation of the spot bitcoin ETF approval but declined after the approval. Currently, the cryptocurrency is trading at $41,697.

Outflow from Grayscale's GBTC Fund

"The $1.5 billion outflow from Grayscale's GBTC fund, in particular, has had a negative impact. It appears that GBTC investors, who had been purchasing the fund at a significant discount to its net asset value (NAV) over the past year, in anticipation of its eventual ETF conversion, have decided to fully cash out after the ETF conversion instead of shifting to cheaper spot bitcoin ETFs," noted Panigirtzoglou.

Panigirtzoglou previously estimated that up to $3 billion had been invested in GBTC on the secondary market in 2023 to take advantage of the discount to NAV. He explained, "If the previous estimate of $3 billion proves accurate and considering that $1.5 billion has already exited, there may be an additional $1.5 billion yet to exit the bitcoin market through profit-taking on GBTC. This could further exert downward pressure on bitcoin prices in the coming weeks."

Cumulatively, Grayscale's bitcoin ETF has experienced an outflow of 50,106.59 BTC since January 12, valued at over $2 billion.

Panigirtzoglou also analyzed the other spot bitcoin ETFs that launched on January 11, including Blackrock's Ishares Bitcoin Trust (IBIT) and Fidelity's Wise Origin Bitcoin Fund (FBTC). "Apart from GBTC, the other spot bitcoin ETFs received substantial inflows of $3 billion in just four days: Thursday 11th, Friday 12th, Tuesday 16th, and Wednesday 17th. This is comparable to the inflows seen during previous bitcoin product launches, such as the introduction of CME bitcoin futures or futures-based bitcoin ETFs," the JPMorgan analyst pointed out. He added, "As expected, the majority of this $3 billion inflow represents a shift from existing bitcoin investment vehicles, such as futures-based bitcoin ETFs that have seen outflows of nearly $300 million since last Thursday, or from retail investors moving from digital wallets held with exchanges/retail brokers to more cost-effective spot bitcoin ETFs."

What are your thoughts on JPMorgan's bitcoin price prediction and the estimated outflow from Grayscale? Let us know in the comments section below.

Frequently Asked Questions

Can I have a gold ETF in a Roth IRA

A 401(k) plan may not offer this option, but you should consider other options, such as an Individual Retirement Account (IRA).

Traditional IRAs allow contributions from both the employer and employee. An Employee Stock Ownership Plan (ESOP) is another way to invest in publicly traded companies.

An ESOP provides tax advantages because employees share ownership of company stock and profits the business generates. The tax rate on money that is invested in an ESOP is lower than if it was held in the employees' hands.

An Individual Retirement Annuity (IRA) is also available. You can make regular payments to your IRA throughout your life, and you will also receive income when you retire. Contributions to IRAs do not have to be taxable

Is gold a good investment IRA?

Anyone who is looking to save money can make gold an excellent investment. It is also an excellent way to diversify you portfolio. But there is more to gold than meets the eye.

It's been used throughout history as a currency, and even today, it remains a popular form of payment. It is sometimes called the “oldest currency in the world”.

But gold is mined from the earth, unlike paper currencies that governments create. Because it is rare and difficult to make, it is extremely valuable.

Gold prices fluctuate based on demand and supply. People tend to spend more when the economy is healthy, which means that fewer people are able to mine gold. Gold's value rises as a result.

On the flip side, when the economy slows down, people hoard cash instead of spending it. This means that more gold is produced, which reduces its value.

This is why it makes sense to invest in gold for individuals and companies. If you make an investment in gold, you can reap the economic benefits whenever the economy is growing.

Also, your investments will earn you interest which can help increase your wealth. You won't lose your money if gold prices drop.

What are the benefits of a gold IRA

A gold IRA has many benefits. It's an investment vehicle that lets you diversify your portfolio. You have control over how much money goes into each account.

Another option is to rollover funds from another retirement account into a IRA with gold. This makes for an easy transition if you decide to retire early.

The best part is that you don't need special skills to invest in gold IRAs. These IRAs are available at all banks and brokerage houses. Withdrawals can be made instantly without the need to pay fees or penalties.

There are, however, some drawbacks. Gold is known for being volatile in the past. Understanding why you invest in gold is crucial. Are you looking for safety or growth? Do you want to use it as an insurance strategy or for long-term growth? Only after you have this information will you make an informed decision.

If you are planning to keep your Gold IRA indefinitely you will want to purchase more than one ounce. A single ounce will not be sufficient to meet all your requirements. Depending on the purpose of your gold, you might need more than one ounce.

You don’t necessarily need a lot if you’re looking to sell your gold. You can even live with just one ounce. But you won't be able to buy anything else with those funds.

Should you open a Precious Metal IRA

Before opening an IRA, it is important to understand that precious metals aren't covered by insurance. It is impossible to get back money if you lose your investment. This includes investments that have been damaged by fire, flooding, theft, and so on.

It is best to invest in physical gold coins and silver coins to avoid this type loss. These coins have been around for thousands and represent a real asset that can never be lost. You would probably get more if you sold them today than you paid when they were first created.

Consider a reputable business that offers low rates and good products when opening an IRA. Consider using a third-party custody company to keep your assets safe and allow you to access them at any time.

When you open an account, keep in mind that you won't receive any returns until your retirement. Don't forget the future!

How much of your IRA should include precious metals?

It's important to understand that precious metals aren't only for wealthy people. You don’t need to have a lot of money to invest. There are many ways to make money on silver and gold investments without spending too much.

You might also be interested in buying physical coins, such bullion rounds or bars. Also, you could buy shares in companies producing precious metals. Another option is to make use of the IRA rollover programs offered by your retirement plan provider.

Regardless of your choice, you'll still benefit from owning precious metals. These metals are not stocks, but they can still provide long-term growth.

Their prices are more volatile than traditional investments. This means that if you decide on selling your investment later, you'll likely get more profit than you would with traditional investing.

Can the government take your gold

Your gold is yours and the government cannot take it. You have earned it by working hard for it. It is yours. This rule could be broken by exceptions. You could lose your gold if convicted of fraud against a federal government agency. Your precious metals can also be lost if you owe tax to the IRS. However, if you do not pay your taxes, you can still keep your gold even though it is considered property of the United States Government.


  • Gold is considered a collectible, and profits from a sale are taxed at a maximum rate of 28 percent. (
  • If you accidentally make an improper transaction, the IRS will disallow it and count it as a withdrawal, so you would owe income tax on the item's value and, if you are younger than 59 ½, an additional 10% early withdrawal penalty. (
  • You can only purchase gold bars at least 99.5% purity. (
  • This is a 15% margin that has shown no stable direction of growth but fluctuates seemingly at random. (
  • If you take distributions before hitting 59.5, you'll owe a 10% penalty on the amount withdrawn. (

External Links

How To

Tips for Investing In Gold

Investing in Gold is a popular investment strategy. This is because there are many benefits if you choose to invest in gold. There are several options to invest in the gold. Some people purchase physical gold coins. Others prefer to invest their money in gold ETFs.

Before buying any type gold, it is important to think about these things.

  • First, find out if your country allows gold ownership. If your country allows you to own gold, then you are allowed to proceed. If not, you may want to consider purchasing gold from overseas.
  • Second, it is important to know which type of gold coin you are looking for. You have the option of choosing yellow, white, or rose gold.
  • Thirdly, you should take into consideration the price of gold. It is best to start small and work your way up. It is important to diversify your portfolio whenever you purchase gold. You should invest in different assets such as stocks, bonds, real estate, mutual funds, and commodities.
  • Lastly, you should never forget that gold prices change frequently. Be aware of the current trends.


By: Kevin Helms
Title: JPMorgan Warns of Bitcoin Selloff as Grayscale Sees $3 Billion Outflow
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Published Date: Mon, 22 Jan 2024 01:00:46 +0000

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