Analysts at JPMorgan have expressed doubts regarding the sustainability of the $12 billion influx into cryptocurrency assets so far this year, especially considering the current lofty prices of bitcoin in comparison to production expenses and gold. The significant increase in funds this year has mainly been fueled by spot bitcoin exchange-traded funds (ETFs). Nevertheless, a large portion of this money flow signifies a transition from cryptocurrency wallets on exchanges to spot bitcoin ETFs, which is driven by their cost efficiency, liquidity, and regulatory advantages. After accounting for this transition, the actual net inflow amounts to approximately $12 billion. Despite the possibility of a yearly net inflow of $26 billion if this trend persists, analysts remain hesitant due to the elevated prices of bitcoin. This hesitancy aligns with their previous reservations regarding the impact of spot bitcoin ETF approvals on attracting fresh capital to the cryptocurrency sector.
