JPMorgan: Crypto Flows Survive Mostly On Strategy Purchases

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Saylor’s solo act: JPMorgan says Strategy is practically the only thing keeping crypto flows aliveFinance

What to know:

  • JPMorgan estimated Q1 digital asset inflows at ~$11 billion, a sharp slowdown from 2025 levels.
  • Investor demand weakened, with softer CME futures positioning and ETF outflows early in the quarter.
  • Flows were driven mainly by Strategy purchases and concentrated VC funding, according to the report.

JPMorgan, a major Wall Street investment bank, reported a significant slowdown in investments into digital assets during the first three months of 2026. They estimate that around $11 billion flowed into these assets during that period.

This suggests current sales would reach around $44 billion over a year, which is about a third of the expected sales for 2025, as detailed in a report released last week.

According to analysts led by Nikolaos Panigirtzoglou, investment in digital assets has been limited or has decreased so far this year. Most of the investment activity in the first quarter of 2026 came from MicroStrategy’s (MSTR) bitcoin purchases and funding for crypto venture capital firms.

The first three months of the year were tough for crypto markets. Prices fell significantly across the board as investors became more cautious. The total value of all cryptocurrencies dropped about 20%, with Bitcoin down around 23% and Ether (ETH) declining by more than 30%. This was one of the worst starts to a year for crypto in recent history.

The recent price drops were caused by economic and global political issues, leading investors to sell off their holdings and generally move away from riskier investments. Altcoins, which are alternative cryptocurrencies, experienced even more significant declines.

Even though the market experienced a decline, prices became more stable towards the end of the quarter. Bitcoin settled around $70,000 as demand for ETFs increased, and certain parts of the crypto market – like some alternative cryptocurrencies and activity directly on the blockchain – remained strong.

The bank calculated total cryptocurrency activity by combining data on fund flows, futures trading on the Chicago Mercantile Exchange (CME), venture capital investments, and corporate bitcoin purchases – like those made by companies such as Strategy.

Analysts noted that investment activity was surprisingly low. Interest in bitcoin and ether futures contracts decreased compared to earlier in 2024 and 2025, hinting that large investors might be starting to sell. Bitcoin and ether exchange-traded funds (ETFs) experienced net outflows of money during the quarter, particularly in January, though there was a small increase in bitcoin ETF investments in March.

The bank’s analysts said most of the money coming in this quarter was due to businesses managing their cash and investments in new ventures. A key strategy for some buyers involved purchasing bitcoin by issuing new stock, and they plan to continue using stock and preferred stock to fund these purchases. Other companies holding bitcoin were more cautious, and a few even sold some of their bitcoin to buy back their own company shares.

According to the report, Bitcoin miners sold off some of their holdings during the quarter. They did this either to get more immediate cash, invest in their businesses, or cover debts. Analysts believe this selling wasn’t due to financial trouble, but rather a result of stricter lending conditions and careful financial management.

Despite the overall downturn in the crypto market, venture capital funding remained relatively strong. While the total amount of funding was up compared to the previous two years, it was focused on a smaller number of larger investments made by well-known firms. Investors continued to prioritize areas like core crypto infrastructure, stablecoins, payment solutions, and tokenization technologies, while showing less interest in gaming, NFTs, and projects related to cryptocurrency exchanges, according to the report.

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2026-04-08 16:55