JPMorgan "Bitcoin decline caused by individual selling of spot ETFs"

An analysis has emerged that the current Bitcoin (BTC) decline originated from individual selling of spot ETFs.

On the 20th (local time), according to JPMorgan, the key cause of this adjustment was not crypto-native investors but large-scale selling by individual investors who had been buying Bitcoin and Ethereum spot ETFs.

JPMorgan said in the report, "The October adjustment was due to large-scale deleveraging by crypto-native investors in the perpetual futures market, but in November that reduction in leverage stabilized," and added, "What is continuing the decline across the crypto market now are non-crypto investors using spot ETFs, mainly individuals."

According to JPMorgan, roughly $4 billion exited Bitcoin and Ethereum spot ETFs in November, already surpassing the largest net outflow recorded in February this year.

Interestingly, this is the exact opposite of individual investors' flows into stock ETFs. For stock ETFs (including leveraged products), about $96 billion flowed in net in November. If this trend continues, it would be about $160 billion for the month, reproducing the strong inflows seen in September and October.

JPMorgan said, "This pattern repeated three times this year," adding, "Individuals consistently show buying in stock ETFs but treat crypto ETFs as a separate investment bucket and selectively sell them."

It added, "It would be plainly wrong to judge, based solely on crypto ETF selling flows, that individual investors have turned pessimistic toward all risk assets."