JPMorgan: Strategy's BTC Sales Add Two-Way Risk
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- JPMorgan said Strategy's bitcoin sales policy introduces avoidable "two-way" flow risk and argued the firm should hold 24–36 months of dividend obligations in cash, above its current 17-month buffer of $2.55 billion.
- Strategy formalized the policy earlier this week, allowing selective BTC sales to fund preferred dividends alongside authorized buybacks, and set a minimum 12-month cash reserve target.
- Strategy holds 847,363 BTC — roughly 4% of bitcoin's total supply — and has purchased about $13.7 billion year-to-date, an amount JPMorgan estimates equals 70% of total net digital asset inflows.
- U.S. spot bitcoin ETFs suffered a record $4 billion in net outflows in June after a 13-day redemption streak pushed year-to-date flows negative for the first time since their 2024 debut.
- Bitcoin came under pressure in late May and early June after Strategy disclosed in a June 1 filing that it sold 32 BTC between May 26 and May 31 to cover dividend payments, compounding a broader Fed-driven repricing.
- JPMorgan said current bearish sentiment could prove a contrarian bullish signal, but a stronger second half hinges on Strategy expanding reserves and Congress passing pending crypto market structure legislation.
Why it matters: Strategy holds 4% of all bitcoin and accounts for an estimated 70% of net digital asset inflows this year, so any selling adds structural supply to a market that just saw its first negative year-to-date period for spot ETFs ($4B in June outflows). JPMorgan's fix: issue equity, build 24–36 months of dividend coverage, and take BTC sales off the table.
