Record Bets Against BlackRock’s Bitcoin Fund Are Bullish, JPMorgan Says — and Shorts Could Fuel the Next Rally

Bitcoin skeptics have piled into one of the largest crypto funds on Wall Street at the fastest pace of the year — and JPMorgan says that is actually a bullish signal. In a note earlier this week, the bank’s analysts argued Bitcoin could draw stronger price support than gold once ETF hedging demand finally eases.

By Yasmin Al-Rashid | September 19, 2026

The note, led by JPMorgan analyst Nikolaos Panigirtzoglou, lands at a curious moment. Bitcoin trades near 81,300 USD as of Saturday evening, according to CoinGecko data, up sharply from the mid-76,000 USD area where it sat when the note was published Thursday. Yet behind the rally, professional traders have been building one of the biggest bearish bets of 2026 — and JPMorgan’s team reads that crowd as fuel for the next leg higher.

The Hook: A Record Short Squeeze Waiting to Happen?

Here is the counterintuitive logic. When investors short an ETF — borrowing shares to bet the price falls — those positions must eventually be bought back. If the price rises instead, shorts are forced to repurchase at worse prices, pushing the asset higher still. That chain reaction is called a “short squeeze,” and the raw material for one is now unusually abundant in Bitcoin.

Figures reported by FINRA and compiled by MarketBeat put short interest in BlackRock’s iShares Bitcoin Trust (IBIT) at 45.9 million shares as of the August 31 settlement date. That is the highest reading of 2026, and a 23.8 percent jump from 37.1 million shares just two weeks earlier. For context, the short base stood near 13 million shares at the end of March — the year’s low — meaning bearish positioning has roughly tripled since spring.

• 45.9 million IBIT shares sold short — a 2026 high as of August 31
• 3.53 percent of the fund’s float is sold short
• 0.6 days to cover — at IBIT’s average trading volume of about 53 million shares, shorts could unwind fast
• IBIT’s put-to-call ratio runs above that of the SPDR Gold Shares ETF (GLD), signaling heavier hedging around Bitcoin

The Core Conflict: Bitcoin’s Ugly Positioning Versus Gold’s Clean Slate

The comparison with gold is the heart of the note. Gold ETFs have fully recovered their outflows from earlier this year, JPMorgan wrote, while Bitcoin funds have recaptured only about half of theirs. Short interest in GLD sits below its historical average, while IBIT’s sits near yearly highs. In plain English: the “smart money” is still cautious on gold but openly skeptical of Bitcoin.

Both asset classes drew inflows after the Federal Reserve’s late-July meeting, when the “debasement trade” returned — investors rotating into scarce assets on worries about US fiscal policy, a rally that carried Bitcoin toward 80,000 USD and gold near 4,600 USD an ounce. But momentum faded over the past week, the analysts noted, as inflation-adjusted bond yields rose and the US Senate failed to advance the CLARITY Act crypto bill in a procedural vote that fell short of the 60 votes needed.

Spot Bitcoin ETF flows themselves have been swinging violently this month: 236 million USD in outflows on September 1, then a 731 million USD inflow on September 3 — the strongest single day since January — with IBIT alone accounting for roughly 454 million USD, per CryptoPotato. Net assets across the funds stood at 103.3 billion USD in early September, about 6 percent of Bitcoin’s market capitalization, according to SoSoValue data.

Market Implications: The 266,000 USD Question

JPMorgan’s team has run the Bitcoin-versus-gold comparison before. In February, with crypto assets under pressure, they pegged a volatility-adjusted fair value for Bitcoin at 266,000 USD per coin based on its relationship with gold. They called that “an unrealistic target for this year,” but one that “shows the upside potential over the long term once negative sentiment is reversed.”

The key phrase is “once negative sentiment is reversed.” That is precisely what the bank says is still pending: as long as hedging demand keeps short interest elevated, Bitcoin trades with a ceiling of skepticism that gold has already shaken off. If those hedges unwind — because prices keep climbing or macro fears fade — the buying pressure from covering shorts would arrive on top of fresh inflows, not instead of them.

The Verdict

For regular investors, the takeaway is a lesson in reading sentiment backwards. Record short interest sounds bearish, and it reflects genuine professional doubt. But positioning is a snapshot, not a prophecy — and crowded bearish bets have historically preceded some of Bitcoin’s sharpest rallies upward, because every short is a future buyer. JPMorgan’s message is not that Bitcoin is guaranteed to beat gold from here; it is that the obstacle is hedging pressure, not demand, and hedging pressure fades.

Watch two signals in the weeks ahead: the next FINRA short-interest settlement for IBIT, and whether Bitcoin ETF inflows keep pace with gold funds now that the CLARITY Act disappointment is priced in. If the short base starts shrinking while prices hold above 80,000 USD, the squeeze scenario is doing its work quietly.

The cryptocurrency market remains highly volatile. This article is for informational purposes only and does not constitute financial advice.