JPMorgan Flags Crypto Sell-off Bottom as ETF Flows Turn Two-Way
JPMorgan analysts pointed to a stabilizing flow pressure across spot crypto ETFs in early January, after two months of late 2025 de-risking that leaned heavily on ETF redemptions rather than a liquidity freeze. Bitcoin is currently trading at $90,428 (-2.50%) in the latest print, while Ethereum is trading at $3,100 (-4.54%).
Spot ETF Flows Stabilize After Late-2025 De-Risking
The bank’s read lines up with tape-level evidence that flow is now two-way, not one-way. U.S. spot Bitcoin ETFs printed $697.25 million in net inflows on Jan. 5, then flipped to $243 million in net outflows on Jan. 7. That pattern matters because it replaces “forced reduction” with “tactical rotation,” which historically tightens intraday ranges and improves bid support in BTC perp funding regimes.
JPMorgan’s framework also matches prior positioning commentary from Nikolaos Panigirtzoglou’s team, which separated October perp deleveraging from November ETF-led selling by non-crypto investors, mostly retail ETF users. That distinction keeps the correction narrative anchored in positioning rather than a broken market plumbing story.
Outside the ETF channel, traditional allocators received a separate “risk-off relief” input this week when MSCI said it will not remove digital-asset treasury companies (DATCO) from indexes for now, while it runs a broader review. Shares of Strategy’s (MSTR) traded higher after the update, reducing near-term forced-selling risk for passive index products that hold crypto-proxy equities.
Why Two-Way Flows Are Changing the Trade Setup
The trade here is less about a single JPMorgan call and more about flow regime change: late 2025 looked like an unwind where ETF redemptions and perp deleveraging reinforced each other, while early January has shown creation days and redemption days alternating, which desks can hedge more cleanly via basis and options.
If MSCI keeps the “DATCO” bucket in benchmarks through the February review window, systematic equity reallocations stop acting like a hidden sell program for crypto beta, which supports tighter correlations among BTC spot, CME basis, and listed ETF flow momentum into month-end rebalancing.
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