A new JPMorgan report shows Bitcoin has pulled decisively ahead of Ethereum as the preferred base layer for institutional capital, with Bitcoin investment products recovering outflows at double the rate of their Ethereum counterparts.
"Both ether and other altcoins have been underperforming bitcoin despite the crypto market recovery," JPMorgan analysts led by Nikolaos Panigirtzoglou said in a report published May 19. The bank noted that spot Bitcoin ETFs have clawed back roughly two-thirds of prior outflows, a figure that dwarfs the one-third recovery seen by spot Ethereum ETFs.
The divergence in institutional demand is further evidenced by recent 13F filings. In the first quarter of 2026, major firms reportedly reduced their Ethereum exposure, with JPMorgan cutting its position by 89% and Fidelity by 84%, according to a recent BitMine disclosure analysis. This institutional exit occurred despite a broader narrative that upcoming regulation like the CLARITY Act could heavily favor the Ethereum network. The data suggests that for large allocators, Bitcoin's perceived role as a primary digital asset is outweighing potential regulatory tailwinds for other networks.
The trend comes even as Bitcoin faces its own volatility. On May 18, spot Bitcoin ETFs recorded their largest single-day net outflow since January, shedding $649 million as the price slipped below $77,000. Still, the market's total assets under management of approximately $85.3 billion provide a substantial cushion. While other institutional players like Citadel have shown interest in assets such as XRP, JPMorgan's analysis indicates the primary institutional story remains Bitcoin's growing dominance over the altcoin market, including Ethereum.
This article is for informational purposes only and does not constitute investment advice.
