JPMorgan attributes the recent Bitcoin (BTC) and Ethereum (ETH) sell-off to crypto-native leverage rather than institutional exits, noting that spot ETFs and CME futures absorbed minimal forced selling while perpetual futures markets faced sharp deleveraging across both assets.
Bitcoin fell 13.1% from $122,316 on Oct. 3 to $106,329 by Oct. 17, while perpetual open interest dropped from approximately $70 billion to $58 billion on Oct. 10. This $12 billion decline signals forced liquidations rather than orderly position exits.
Farside Investors’ data shows that Bitcoin spot ETFs recorded $70.4 million in net outflows concentrated on Oct. 14, 15, and 16, minimal compared to the scale of the price move and the leverage flush in derivatives markets.
Ethereum saw even more severe deleveraging relative to its market size. Perpetual open interest fell from roughly $28 billion to between $19 billion and $20 billion on Oct. 10, representing a $9 billion to $10 billion drop.
Ethereum spot ETFs recorded $668.9 million in net outflows across Oct. 9, 10, 13, and 16, nearly 9.5 times Bitcoin ETF outflows, with concentrated redemptions on Oct. 10 and Oct. 13.
Despite the larger institutional response in Ethereum ETFs, JPMorgan concluded that perpetual futures deleveraging drove price action in both assets, with ETF flows showing “little forced selling” relative to the derivatives cascade.
The data support the bank’s thesis. Ethereum’s open interest declined by roughly 35%, while Bitcoin’s fell by approximately 17%. However, both assets experienced a coordinated sell-off on Oct. 10 as leverage unwound across crypto-native venues.
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