JPMorgan Major Report: The "De-Risking" Cycle in the Crypto Market Has Ended, Is a New Phase Beginning?

Recently, top Wall Street financial institution J.P. Morgan released a highly anticipated analysis report. The report points out that as the capital flow in the spot Bitcoin exchange-traded fund (ETF) stabilizes, the “de-risking” trend that has overshadowed the crypto market since Q4 of last year may have come to an end. This judgment provides an important institutional perspective and market direction reference for the current critical stage of the crypto asset market.

Core Signal: ETF Capital Flows Shift from “Runaway” to “Balance”

J.P. Morgan’s analyst team believes that the key factor in judging a market trend reversal is a fundamental change in the capital flow of the spot Bitcoin ETF.

In Q4 2025, the market experienced a significant “de-risking” process, characterized by continuous net outflows of ETF funds and investors simultaneously reducing positions across different crypto asset classes. This widespread risk-averse behavior exerted ongoing pressure on the market.

However, in January 2026, positive changes emerged. Taking data from January 5 to January 9 as an example, market volatility persisted, but funds showed a two-way flow with both inflows and outflows, rather than the previous unilateral net outflow. This indicates that the phase driven by panic or forced selling may have passed, and the market is returning to a healthier, more balanced normal. The stability of capital flows is the primary foundation for market sentiment recovery and structural stabilization.

Multi-dimensional Data Confirm: Market Pressure Is Easing

In addition to ETF capital flows, several other key indicators also support the “trend inflection point” judgment.

• Futures Market Positions: Data such as Bitcoin futures positions on the Chicago Mercantile Exchange (CME) and funding rates of perpetual contracts on major crypto trading platforms indicate that extreme net short positions and bearish sentiment have been significantly corrected. Market leverage levels are trending towards healthy, and ongoing selling pressure has noticeably weakened.
• Macro Policy Environment Eases: Recently, leading global index provider MSCI announced that in its upcoming quarterly review in February, it will not exclude companies like MicroStrategy that hold large amounts of Bitcoin from relevant indices. This decision alleviates short-term concerns about massive passive fund sell-offs and provides the market with a valuable breather.
• Institutional Perspective Shift: J.P. Morgan’s report redefines the nature of this adjustment from concerns about a “liquidity crisis” to a “de-aggregation” and position adjustment related to specific events (such as MSCI’s previous review statement). With this structural operation completed, market attention is beginning to shift back to the long-term fundamentals narrative of crypto assets.

Current Market Dynamics and Price Observation

As market sentiment marginally improves, major crypto asset prices have recently shown signs of stabilization. As of January 9, according to real-time data from the Gate platform:

• Bitcoin (BTC) price fluctuates within the $90,500 - $92,000 range, attempting to establish a solid support above the $90,000 mark.
• Ethereum (ETH) price trades within the $3,080 - $3,150 range, following the overall market trend, with market focus on its ecosystem development and subsequent ETF progress.

It should be noted that the “end” of the trend does not mean an immediate move into a one-sided upward channel. J.P. Morgan’s report also suggests that the market may currently be in a “fragile balance.” A true trend reversal requires stronger signals such as macroeconomic outlook improvements, clear regulatory benefits, or a new round of large-scale capital inflows for confirmation.

Investor Guidance: Responding to the New Stage on the Gate Platform

J.P. Morgan’s report provides a clear framework for investors to understand market cycles. If the “de-risking” phase is indeed nearing its end, what does that mean for investors?

1. Strategy Shift: The market’s driving logic may shift from “risk aversion and reducing positions” to “selective allocation.” Investors should pay more attention to specific project developments, ecosystem activity, and fundamentals for refined selection.
2. Utilize Diversification Tools: On a comprehensive trading platform like Gate, investors can leverage various tools to navigate the new stage. For example, during consolidation periods with potentially lower volatility, strategies like grid trading can be considered; for long-term optimists, dollar-cost averaging (DCA) remains a rational way to smooth costs and accumulate positions.
3. Pay Close Attention to Market Indicators: Daily capital flow data of spot Bitcoin ETFs, CME futures positions, and viewpoints from mainstream institutions like J.P. Morgan will become high-frequency indicators for judging capital sentiment and trend continuation. The Gate platform offers relevant market information and data analysis tools to assist investors in decision-making.

Conclusion

J.P. Morgan’s report is like a spring thunder, signaling that the harsh winter in the market may have passed. From stable ETF capital flows to the release of futures market pressure and the temporary easing of macro disturbances, multiple pieces of evidence point to the possibility that the most difficult phase of “forced de-risking” in the crypto market has ended.

The market is entering a new, more complex stage. For keen investors, this is both a challenge and an opportunity in the making. At Gate, we are committed to providing users with a safe, professional, and cutting-edge trading environment and market insights, together welcoming the next cycle of the crypto market.