JPMorgan: Bitcoin Could Outshine Gold as IBIT Hedges Unwind

JPMorgan says Bitcoin could draw more support than gold if heavy ETF hedging around BlackRock's IBIT unwinds, with short interest near a 2026 high.

In a note dated September 17, JPMorgan analysts led by Nikolaos Panigirtzoglou argued that Bitcoin could gain more relative support than gold if investors unwind the short positions and protective options currently hedging their Bitcoin ETF holdings. The bank's reasoning is mechanical rather than fundamental: a large pool of shorts and put options represents pressure that has to go somewhere, and if confidence improves while investors keep their underlying ETF exposure, closing those hedges becomes a fresh source of demand. Because Bitcoin's hedge overhang is proportionally larger than gold's, unwinding it could deliver a bigger boost to Bitcoin than to gold.

The claim cuts against the surface-level flow data: gold ETFs have fully recovered their earlier 2026 outflows, while Bitcoin ETFs have recaptured only about half of theirs, which would normally suggest gold holds the stronger hand. JPMorgan instead frames the shortfall as an opportunity, noting it leaves more room for Bitcoin ETF demand to rebuild if sentiment turns. It is also the bank's second Bitcoin-over-gold call this year. In February the case rested on volatility comparisons and produced a long-term target of $266,000 per Bitcoin, which the analysts themselves called unrealistic for that year. The September note reaches a similar conclusion through entirely different evidence — options and short-interest positioning rather than volatility.

Short interest in BlackRock's iShares Bitcoin Trust (IBIT) sits near its highest level of 2026, while short interest in the SPDR Gold Shares ETF (GLD) is below its historical average. IBIT's put-to-call open interest ratio also runs higher than GLD's, which JPMorgan reads as investors paying up for Bitcoin downside protection at a rate gold investors are not. CryptoPotato, citing FINRA data compiled by MarketBeat, reports IBIT's short base at 45.9 million shares as of the August 31 settlement — up 23.8% from 37.1 million two weeks earlier and 3.53% of the float. At the end of March the short base stood near 13 million shares, the year's low.

Both Bitcoin and gold ETFs drew inflows after the Federal Reserve's late-July meeting, when the debasement trade — rotation into scarce assets on US fiscal concerns — returned, helping carry Bitcoin toward $80,000 and gold near $4,600 an ounce. Yet institutional money still hedges Bitcoin far more heavily than gold. Bloomberg ETF analyst Eric Balchunas offers a structural explanation: institutions still lean toward gold because Bitcoin remains more volatile and tends to trade in step with technology stocks, making it a less reliable diversifier in risk-off periods. He noted that balance could shift if Bitcoin's volatility eases and its equity correlation weakens over time.

The debasement trade has cooled over the past week as inflation-adjusted bond yields rose, and the Senate failed to advance the CLARITY Act in a 49-50 cloture vote on September 15, falling short of the 60 votes needed. The Cryptonomist reports that US spot Bitcoin ETFs saw $450.4 million in net outflows that same day, with Fidelity's FBTC leading withdrawals and IBIT also posting heavy redemptions. Net assets across the funds stood at $103.3 billion in early September, about 6% of Bitcoin's market capitalization, per SoSoValue data cited by CryptoPotato. Bitcoin traded near $76,500 on Thursday, little changed over 24 hours, per CoinGecko.

JPMorgan's own condition is the crux: the support only materialises if investors close hedges because they are getting more comfortable, not because they are heading for the exits. Closing a short is not the same as opening a long, and persistent net outflows could outweigh any unwind-driven demand. The tell is whether IBIT's short interest and put-to-call ratio fall alongside genuine net inflows — hedges unwinding plus fresh money — or whether inflows stall even as hedges close. A move together would confirm JPMorgan's read; a move apart would suggest the positioning gap reflects ongoing wariness rather than an unwind opportunity. Real yields and dollar strength also remain relevant to the debasement trade.