Bitcoin’s recent price surge, driven by optimism surrounding the potential approval of bitcoin exchange-traded funds (ETFs) in the United States, has sparked excitement in the crypto community. However, JPMorgan holds a more skeptical view on the matter.
The bank acknowledges two major reasons behind this enthusiasm. First, the approval of bitcoin ETFs could potentially bring a fresh wave of investments into the cryptocurrency market.
Second, it might lead the U.S. Securities and Exchange Commission (SEC) to adopt a more lenient stance toward crypto regulation. However, JPMorgan isn’t entirely convinced that this optimism is well-founded.
One of the bank’s concerns is that, instead of bringing entirely new investments, the introduction of bitcoin ETFs might lead to a shift of funds from existing bitcoin investments to these new ETFs.
Furthermore, JPMorgan points to the relatively lackluster interest generated by ETFs in Canada and Europe, casting doubt on whether U.S. ETFs will experience a different outcome.
JPMorgan also asserts that potential legal issues and losses incurred by the SEC won’t necessarily translate into looser crypto regulations.
Given the recent FTX scandal and the overall strict approach to cryptocurrencies taken by U.S. lawmakers, the bank doesn’t anticipate a significant shift in regulatory attitudes.