Recent market analysis from JPMorgan indicates that the sharp decline in Bitcoin (BTC) and Ethereum (ETH) prices stemmed primarily from crypto-native leverage unwinding rather than institutional capital flight. Between October 3rd and October 17th, Bitcoin experienced a 13.1% correction, falling from $122,316 to $106,329, while Ethereum mirrored this downward trajectory.
The investment bank’s research reveals that spot Bitcoin ETFs and CME futures markets demonstrated remarkable resilience during this period, absorbing minimal forced selling pressure. In contrast, perpetual futures markets underwent significant deleveraging across both major digital assets. This divergence highlights the growing sophistication of cryptocurrency market structures, where traditional financial instruments now provide stability during volatility episodes that primarily affect crypto-native trading venues.
Market data shows perpetual open interest declining substantially as traders reduced leveraged positions, creating cascading sell pressure that temporarily overwhelmed spot market support levels. The relative stability of institutional investment vehicles suggests mature capital is maintaining longer-term positions despite short-term volatility driven by leveraged crypto traders. This market dynamic underscores the evolving relationship between traditional finance infrastructure and native cryptocurrency trading mechanisms during correction phases.
