US tax filers may see bigger refunds in 2026 compared with previous years, a development one Wall Street strategist said may boost risk appetite for digital assets and tech stocks preferred among retail investors.
In a note cited by CNBC, Wells Fargo analyst Ohsung Kwon said the coming refund wave may help bring back the so-called “YOLO” trade, with as much as $150 billion potentially flowing into equities and Bitcoin (BTC) by the end of March. Kwon said the extra cash could be most visible among higher-income consumers.
“Speculation picks up with bigger savings…we expect YOLO to return,” wrote Wells Fargo analyst Ohsung Kwon in a Sunday note seen by news outlet CNBC. “Additional savings from tax returns, especially for the high-income consumer will flow back into equities, in our view,” he added.
Kwon said some of that liquidity could move into Bitcoin and into stocks popular with retail traders, including Robinhood and Boeing.
Cointelegraph contacted Wells Fargo for details on the assumptions behind the $150 billion estimate and how much of that total the bank expects could go to digital assets, but had not received a response by publication time.
Bitcoin demand depends on sentiment
While some of the taxpayer funds may flow into Bitcoin and digital assets, it’s important to consider the higher inflation and consumer spending compared to the period during the COVID-19 pandemic, Nicolai Sondergaard, research analyst at crypto intelligence platform Nansen, told Cointelegraph:
“If sentiment starts to come around and retail sees positive upwards momentum in crypto assets, I see that as increasing the likelihood of funds flowing in this direction.”
Conversely, retail investors may opt for other assets with “higher momentum and social stickiness,” if digital asset sentiment doesn’t improve in the near term, he said.
The larger tax returns are due to the passage of US President Donald Trump’s One Big Beautiful Bill, which included numerous favorable provisions for 2025 tax filings.
Trump signed the One Big Beautiful Bill Act into law on July 4, 2025, saying it would cut as much as $1.6 trillion in federal spending.
Related: BlackRock enters DeFi as institutional crypto push accelerates: Finance Redefined
Smart money bets on crypto market downside as whales quietly accumulate
Meanwhile, the whales, or large investors, continue their quiet spot accumulation of the leading cryptocurrencies, while the most profitable traders by returns, tracked as “smart money,” are betting on more crypto market downside.
Smart money trader positions through the Hyperliquid exchange, top tokens. Source: Nansen
Smart money traders were net short on Bitcoin for a cumulative $107 million, along with most of the leading cryptocurrencies excluding Avalanche (AVAX), according to crypto intelligence platform Nansen.
Related: Binance completes $1B Bitcoin conversion for SAFU emergency fund
Still, whales acquired over $41.9 million worth of spot Ether (ETH) tokens across 22 wallets during the past week, marking a 1.7-fold increase in the spot purchases of this cohort.
Magazine: Bitcoin’s ‘biggest bull catalyst’ would be Saylor’s liquidation — Santiment founder
