Bitcoin (BTC) has surpassed gold in terms of investor portfolio allocation when accounting for volatility, according to a statement from JPMorgan managing director Nikolaos Panigirtzoglou. Panigirtzoglou noted that when adjusting for volatility, Bitcoin’s allocation in investor portfolios is 3.7 times greater than that of gold.
The analyst also highlighted the significant inflow of over $10 billion into Bitcoin exchange-traded funds (ETFs) since the beginning of the year, and suggested that the potential market size for Bitcoin ETFs could reach $62 billion when compared to gold.
According to a report from JPM Securities, the spot Bitcoin ETF market could potentially grow to as much as $220 billion within the next two to three years.
Bitcoin ETFs have proven to have a positive impact on the crypto market, with the largest cryptocurrency experiencing a 45% increase in market cap in February. In February, net sales for spot Bitcoin ETFs reached $6.1 billion, compared to $1.5 billion in January.
On March 12, the largest daily inflow for spot ETFs exceeded $1 billion, and analysts believe this number will continue to rise once the outflows from Grayscale’s GBTC ETF cease.
With the Bitcoin halving just a little over a month away, the daily supply of BTC will be cut in half. This could further fuel demand and potentially lead to a supply crisis within the next six months, as predicted by Ki Young Ju, the CEO of crypto analytics firm CryptoQuant.
After a prolonged “crypto winter” lasting nearly three years, the approval of spot Bitcoin ETFs has acted as a catalyst for Bitcoin’s significant price surge, surpassing the previous all-time high of over $69,000 from the last bull cycle. Additionally, institutional adoption, led by the world’s largest asset manager BlackRock, has further contributed to Bitcoin’s growth.
Despite outflows from Grayscale’s GBTC ETF, the top nine out of the 11 approved ETFs have seen significant net inflows amounting to hundreds of millions of dollars.