Bitcoin has overtaken gold in the portfolios of many investors.

According to JP Morgan, cryptocurrencies are being allocated 3.7 times more than gold bullion in investment portfolios.

A recent report by JP Morgan, the largest bank in the US, shows that Bitcoin has surpassed gold in investor portfolio allocations. Specifically, the world's largest cryptocurrency has an allocation 3.7 times larger than that of gold bullion.

This is further evidenced by the significant inflow of over $10 billion into spot Bitcoin ETFs since their approval in January. According to this firm, the potential market size for Bitcoin ETFs could reach $62 billion, using gold as a benchmark.

However, JP Morgan notes that this does not mean people are selling gold to invest in digital assets. The bank says that institutional and individual investors are buying both gold and Bitcoin this year, not switching between the two asset classes as some analysts have hypothesized.

In fact, Bitcoin ETFs have seen a surge in capital inflows, while money is flowing out of gold ETFs. But JP Morgan says it's impossible to conclude from this that investors are shifting from precious metals to cryptocurrencies.

Observations from the largest bank in the US show that financial advisory firms have been investing in both gold and Bitcoin futures since February, outpacing retail investors, with $7 billion in Bitcoin futures and $30 billion in gold futures.

However, the full potential of Bitcoin ETFs to attract capital has yet to be realized. Another report from JPM Securities predicts that the spot Bitcoin ETF market could grow to $220 billion in the next two to three years. "This could also have a significant impact on the price of Bitcoin," the report states.

Exchange-traded funds (ETFs) have proven to be a positive driver for the cryptocurrency market, with the world's largest Bitcoin ETF gaining over 45% in market capitalization in February alone, then quickly reaching consecutive highs in March. Net revenue from spot Bitcoin ETFs surged to $6.1 billion in February, an impressive figure compared to $1.5 billion in the first month of the year.

Last week, inflows into the largest funds peaked at over $1 billion on March 12th. Analysts believe this figure could increase further in the near future.

In just over a month, the Bitcoin halving – the event that reduces miners' rewards by half – will take place. This makes mining increasingly difficult, thereby creating a supply shortage and further fueling demand. Ki Young Ju, CEO of cryptocurrency analytics firm CryptoQuant, predicts a supply crisis within the next six months.

Tieu Gu (according to CoinDesk , CoinTelegraph )

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