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‘Debasement trade’ falls out of favor as inflation fears cool, JPMorgan says
Investors are abandoning bitcoin and gold, perhaps sensing a coming end to Middle East hostilities.
May 28, 2026, 1:38 p.m. 2 min read
What to know:
- JPMorgan says the pandemic-era “debasement trade,” centered on bitcoin and then gold, is cooling, with recent outflows from bitcoin and gold ETFs and reduced institutional futures positions reflecting a broader pullback from macro hedges.
- The bank’s report suggested investors may be getting ahead of a U.S.-Iran peace deal.
In this article
That shift signals a broader retreat from macro hedge trades that became popular earlier this year amid fears of inflation and global instability stemming from tensions in the Middle East.
Bitcoin ETFs have seen significant outflows over the past two weeks, according to data from Farside Investors, in line with gold ETFs, while positions in CME bitcoin and gold futures have weakened over the same period.
Panigirtzoglou argued that the move does not appear to reflect investors rotating from bitcoin into gold, but rather that both assets are seeing softer demand at the same time.
“Bitcoin had been the main manifestation of the debasement trade since the start of the Iran conflict,” the report said.
