-
Retail investors have sold around 4 billion dollars of spot bitcoin and ether ETFs this month.
-
JPMorgan says this is the main reason for the latest crypto correction, not crypto-native traders.
-
Retail is still buying equities aggressively, showing the crypto sell-off is not a broader shift away from risk.
-
Analysts say correlations with tech stocks remain intact despite ETF outflows.
Retail Outflows Trigger the Latest Market Drop
JPMorgan analysts say the sharp crypto pullback in November is being driven mostly by retail investors exiting spot bitcoin and ether ETFs. About 4 billion dollars has flowed out of these products, already surpassing February’s record. The bank noted that the decline intensified after bitcoin fell below its estimated floor at 94,000 dollars.
Unlike in October, when crypto-native traders drove the correction through large perpetual futures deleveraging, those pressures have now stabilized.
Retail Still Loves Risk, Just Not Crypto This Month
The bank pointed out a major contrast: while retail is selling crypto ETFs, it is aggressively buying equity ETFs. Roughly 96 billion dollars has flowed into equity ETFs this month alone. If that pace holds, November will match the inflow levels seen in September and October. This pattern shows that retail is still interested in risk assets but is treating crypto separately from equities.
Crypto Still Trades in Line With High-Growth Tech
JPMorgan says the long-running correlation between crypto and small-cap tech stocks remains strong. Both sectors continue to move together due to overlapping investor bases and their ties to early-stage innovation.
The most speculative pockets of retail - call-option traders and momentum-focused accounts - have also slowed down recently, partly reversing a surge from October.
Not a Broader Risk-Off Event
Overall, the analysts said the current crypto ETF selling should not be interpreted as a shift to defensive positioning. Retail is still buying risk assets, but crypto ETFs are seeing isolated pressure in November.
