According to CoinDesk, JPMorgan has reported that retail and institutional investors have been purchasing both gold and bitcoin this year, rather than switching between the two assets. The bank's analysis revealed a build-up in gold and bitcoin futures since February, with a sharp position build-up of $7 billion in bitcoin futures and $30 billion in gold futures. JPMorgan analysts, led by Nikolaos Panigirtzoglou, stated that private investors and individuals have propagated both gold and bitcoin year-to-date.
In addition to retail investors, speculative institutional investors such as hedge funds and momentum traders have also contributed to the rally by buying both gold and bitcoin futures since February. The risk of mean reversion appears high, which means both assets could fall back toward their average levels.
Software developer MicroStrategy has also played a part in amplifying the rally, having purchased over $1 billion of bitcoin this year, adding to the more than $1 billion acquired in the last quarter of 2023. JPMorgan's report noted that the debt-funded bitcoin purchases by MicroStrategy add leverage and froth to the current crypto rally, raising the risk of more severe deleveraging in a potential downturn in the future.
