JPMorgan Warns Strategy May Need Larger Cash Reserves to Reassure Investors

Strategy, formerly known as MicroStrategy, may need to strengthen its U.S. dollar reserves to restore investor confidence after its recent sale of 32 Bitcoin, according to analysts at JPMorgan. While the sale was described as voluntary and largely symbolic, it raised concerns among investors about whether the company could eventually sell more Bitcoin to meet financial obligations.

Analysts noted that Strategy’s current cash reserves cover only about 6.3 months of dividend payments, creating uncertainty around its long-term funding plans. The company had previously established a $1.44 billion reserve fund to support preferred stock dividends and debt-related payments.

Bitcoin Holdings Remain Central to Strategy

Despite investor concerns, JPMorgan expects Strategy to continue expanding its Bitcoin holdings. The company currently owns 843,706 Bitcoin, acquired at an average price of $75,699 per coin. At current market levels, that position represents a significant unrealized loss.

Michael Saylor recently hinted at additional Bitcoin purchases, signaling that the company remains committed to its long-term accumulation strategy.

Crypto Market Outlook Depends on Regulation

JPMorgan analysts said a stronger second half for the digital asset market may depend on two major factors: greater clarity from Strategy regarding its annual dividend obligations of roughly $1.7 billion and progress on U.S. crypto market structure legislation.

However, the bank now estimates there is less than a 50% chance that the proposed crypto market structure bill will become law this year, citing political and regulatory challenges ahead of upcoming elections.

Institutional Flows Show Signs of Weakness

The analysts also highlighted slower capital inflows into digital assets during 2026. Total crypto related inflows are estimated at around $22 billion so far this year, well below the pace seen in 2025.

While JPMorgan has become more cautious on digital assets, it suggested that the current negative sentiment could eventually become a bullish contrarian signal if market conditions improve and regulatory clarity increases.