JPMorgan strategists suggest that Bitcoin might gain an edge over gold if investors begin to reduce their protective positions in Bitcoin Exchange-Traded Funds (ETFs). Despite robust institutional interest in both assets, defensive measures against downward risks are noticeably higher for Bitcoin compared to gold, according to the bank.
How do ETF flows differ?
Following the Federal Reserve’s meeting in July, there was renewed buying in both Bitcoin and gold ETFs. Investors seem to be turning to these assets as a hedge against the devaluation of currencies. However, the resurgence in gold ETFs has been markedly stronger.
Data from JPMorgan highlights that inflows into gold ETFs compensated for all previous outflows during the early part of 2026, while Bitcoin ETFs reclaimed only about half. Although these figures initially favor gold, the bank notes that there’s a different narrative beneath the surface when it comes to Bitcoin.
JPMorgan analysts emphasize that the unusual level of defensive positioning in Bitcoin ETFs could offer additional backing for Bitcoin if market sentiment strengthens.
Are hedging positions significant?
One of the key points JPMorgan raises is the high short positions in BlackRock’s iShares Bitcoin Trust ETF. In contrast, the SPDR Gold Shares ETF shows short positions below the historical average. As one of America’s largest banks, JPMorgan is closely monitored for its analyses of global markets.
The options market mirrors this trend. The ratio of open positions between put and call options in the Bitcoin ETF exceeds that of the gold ETF, indicating Bitcoin investors are actively seeking more protection against downturns.
- BTC ETF inflows have only rebounded half of previous outflows.
- Gold ETF inflows have fully recovered prior losses.
- Bitcoin ETF short positions remain high, contrasting with gold’s low averages.
- Strong hedging sentiment is observed in Bitcoin options markets.
Initially, in early 2026, JPMorgan’s Nikolaos Panigirtzoglou and his team had a constructive outlook on digital assets. By February, they expressed optimism for the crypto market throughout the year, estimating Bitcoin’s production cost around $77,000, a decline from the beginning of the year’s figure. They reiterated a volatility-adjusted long-term Bitcoin valuation of $266,000 compared to gold. Yet, JPMorgan’s stance became more cautious as 2026 progressed.
JPMorgan, in June, observed that Bitcoin traded below its estimated production cost for five consecutive months, while also noting legislative deadlines approaching for the Clarity Act. Despite regulatory ambiguity adding complexity to Bitcoin’s institutional positioning, the bank maintains that increased investor confidence and loosening of hedging strategies could potentially favor Bitcoin compared to gold.
