JPMorgan: Blockchains threaten Bitcoin more than Strategy

Financial institutions' accelerating adoption of private, permissioned blockchain networks represents a more significant structural challenge to public cryptocurrencies like Bitcoin than the selling activity of major corporate holders, according to an analysis by JPMorgan Chase & Co. released on July 9. The bank's research team, led by managing director Nikolaos Panigirtzoglou, argues that the migration of core financial functions such as payments, settlement, and asset tokenization onto closed institutional rails could drain activity, liquidity, and capital from public blockchain ecosystems over time.

While recent bitcoin sales by the corporate holding company Strategy have generated market concern, JPMorgan's report characterizes such events as a secondary volatility factor. Strategy sold 3,588 bitcoin for $216 million in early July, its largest disposal on record, to cover preferred dividends. The company holds approximately 4% of bitcoin's circulating supply. JPMorgan analysts noted this introduces periodic selling pressure but is not the primary structural threat.

The deeper risk, they contend, lies in the financial industry's clear preference for permissioned blockchain...