Michael Saylor’s Strategy (formerly MicroStrategy) may need to rebuild its dollar reserves to restore investor confidence and reduce concerns about future bitcoin sales, according to JPMorgan analysts, who have now turned “cautious” on digital assets.
Strategy’s recent decision to sell 32 bitcoin “spooked” markets even if the sale was “symbolic and voluntary,” intended to demonstrate the company’s commitment and flexibility to preferred stockholders, JPMorgan analysts led by managing director Nikolaos Panigirtzoglou said in a report titled Alternative Investments Outlook and Strategy published Friday.
The analysts said Strategy’s current dollar reserves cover only about 6.3 months of dividend payments, adding to investor concerns.
“In our opinion a rebuilding of the company’s dollar reserves might be needed to restore confidence and reduce investor concerns that the company would sell more bitcoins to cover dividend payments,” the analysts said.
In December, Strategy established a $1.44 billion U.S. dollar reserve to safeguard dividend payments on its preferred stock and service interest on outstanding debt.
Earlier Sunday, Saylor, Strategy’s co-founder and executive chairman, instead hinted at a fresh bitcoin buy, posting on X: “A good time to add more dots.” Strategy currently holds 843,706 bitcoin at an average cost of $75,699, representing a paper loss of about $11.5 billion at current prices.
The JPMorgan analysts also expect Strategy to continue buying bitcoin. If its year-to-date pace continues, it would imply around $32 billion of bitcoin purchases in 2026, compared with roughly $22 billion in both 2025 and 2024, the analysts said, revising their estimate from $30 billion last month.
Overall, the analysts said a positive second half of the year would be conditional on Strategy clarifying its strategy for meeting dividend payments of $1.7 billion a year and the passage of the crypto market structure bill, or Clarity Act.
JPMorgan sees less than 50% chance of crypto bill passing this year
But the analysts now see less than a 50% chance of the bill passing this year. Earlier this week, they said the legislation may have only a narrow window for passage as U.S. midterm elections approach, the stablecoin yield debate continues and key hurdles remain.
Overall, the analysts have now turned cautious on digital assets. In an earlier Alternative Investments Outlook and Strategy report published in February, they said they were “overweight” and “positive” on digital assets for 2026 as they expected a further rise in crypto flows led by institutional investors rather than retail investors or digital asset treasury companies.
The rebound in institutional flows they projected was expected to be supported by the passage of additional crypto regulations, including the Clarity Act. The analysts also noted that bitcoin has spent most of this year trading below their estimated production cost, another factor behind their more cautious stance. Their central bitcoin production cost estimate fell from $90,000 at the start of the year to $77,000 as hashrate and mining difficulty declined, before rebounding to about $87,000 more recently. Historically, the analysts said bitcoin’s production cost has tended to act as a “soft floor,” or support level, for the bitcoin price. Bitcoin is currently trading at around $62,000.
The analysts also pointed to weaker capital flows into digital assets this year. They estimate total digital asset inflows at around $22 billion year-to-date, implying an annualized pace of roughly $52 billion, about half the level seen in 2025. The estimate includes crypto fund flows, CME futures positioning, crypto venture capital fundraising and corporate treasury purchases of digital assets, including Strategy’s bitcoin acquisitions.
‘Bullish contrarian signal going forward’
Despite turning cautious, the analysts said the current weak sentiment in crypto markets might prove a “bullish contrarian signal going forward.”
Still, a positive second half of the year “would be conditional on Strategy clarifying its strategy [for] meeting dividend payments of $1.7 billion a year and on the approval of the U.S. market structure legislation for which we now see less than 50% chance,” the analysts concluded.
Besides their comments on Strategy and the crypto bill, the analysts largely reiterated views from several recent reports as part of their broader crypto outlook within alternative assets. They said the debasement trade is “cooling,” security risks and disappointing growth remain major constraints to DeFi’s institutional appeal, and Ethereum and other altcoins are unlikely to meaningfully outperform bitcoin without stronger network activity and real-world adoption.
