JPMorgan explains how the launch of a Bitcoin ETF could affect Bitcoin’s price.

JPMorgan strategists expect that US approval of a Bitcoin ETF would weigh on the price of the leading cryptocurrency in the near term, according to Bloomberg.

According to the firm, competition from ETFs will trigger outflows from Grayscale’s GBTC trust and undermine its monopoly. This would weigh on bitcoin’s price, JPMorgan said.

“A cascade of outflows from GBTC and a narrowing premium [on the secondary markets] will have negative near-term consequences for bitcoin,” the experts said.

In the longer term, the launch of a Bitcoin ETF is a positive development for the market, the analysts added.

Some observers reckon that, with a change in leadership at the US Securities and Exchange Commission (SEC), the odds of approving a Bitcoin ETF will rise.

Earlier, JPMorgan forecast Bitcoin to $146,000.

As of writing, the SEC was reviewing VanEck’s bid to launch a Bitcoin ETF. The asset manager, which manages $49 billion in assets, had previously filed similar applications twice, but withdrew them on each occasion as the regulator refused to approve. The last time this occurred was in September 2019.

The Commission rejected Wilshire Phoenix’s previous active application to launch a Bitcoin ETF in February 2020.

Bitwise, which had also sought regulatory approval to launch an ETF based on the leading cryptocurrency, withdrew the proposal in January 2020.

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