JPMorgan: Second-Half Crypto Outlook Hinges on Strategy Funding and CLARITY Act

JPMorgan has adopted a more cautious stance on digital assets, citing concerns over Strategy’s ability to cover roughly $1.7 billion in annual dividend payments tied to its preferred shares.

While the bank described Strategy’s recent sale of 32 BTC as relatively small, it said the move has raised questions about whether the company could sell additional Bitcoin in the future to help meet dividend payments. JPMorgan also noted that Strategy’s current cash reserves are sufficient to cover only about 6.3 months of those obligations.

Looking ahead, the bank said the second-half outlook for the digital asset market will largely depend on Strategy’s funding strategy and the progress of the CLARITY Act. JPMorgan added that it now estimates the legislation has less than a 50% chance of being approved this year.

Source: The Block