Yahoo Finance·2026-01-08 16:01Core Insights - JPMorgan analysts observed a stabilizing flow pressure in spot crypto ETFs in early January, following a period of de-risking in late 2025 that was characterized by ETF redemptions rather than a liquidity freeze [1][2] - Bitcoin is currently trading at $90,428, down 2.50%, while Ethereum is at $3,100, down 4.54% [1] Group 1: ETF Flow Dynamics - U.S. spot Bitcoin ETFs experienced $697.25 million in net inflows on January 5, which shifted to $243 million in net outflows by January 7, indicating a transition from "forced reduction" to "tactical rotation" [2] - This change in flow dynamics is expected to tighten intraday ranges and enhance bid support in Bitcoin perpetual funding regimes [2] Group 2: Market Positioning and Sentiment - JPMorgan's analysis aligns with previous insights from Nikolaos Panigirtzoglou's team, which differentiated between October's perpetual deleveraging and November's ETF-led selling by non-crypto investors, primarily retail ETF users [3] - This distinction helps maintain the correction narrative focused on positioning rather than systemic market issues [3] Group 3: Traditional Allocators and Risk Sentiment - Traditional allocators received a positive signal when MSCI announced it would not remove digital-asset treasury companies (DATCO) from indexes, which alleviated near-term forced-selling risks for passive index products holding crypto-related equities [4] - The shares of Strategy's (MSTR) increased following this update, indicating a reduction in selling pressure [4] Group 4: Trade Setup Changes - The current trading environment is characterized by alternating creation and redemption days, allowing desks to hedge more effectively through basis and options [5] - If MSCI retains the "DATCO" category in benchmarks during the February review, it could prevent systematic equity reallocations from acting as a hidden sell program for crypto beta, thereby supporting tighter correlations among Bitcoin spot, CME basis, and ETF flow momentum [6]