JPMorgan is telling clients to stop obsessing over miners and instead watch Strategy (MSTR), the company that controls more Bitcoin than anyone else.
According to the bank, the market is far more sensitive to whether Strategy ever becomes a forced seller than to the fact that miners have been unloading coins under pressure.
Key Takeaways
JPMorgan says Strategy’s financial strength matters more for Bitcoin’s outlook than miner selling.
Miner margins are tight with production costs near $90,000, leading to some forced selling.
Strategy’s $1.44B cash reserve signals low liquidation risk.
MSCI index exclusion looks priced in — retention could trigger a sharp rebound.
Bitcoin’s recent weakness, analysts say, is partly tied to structural issues inside the mining industry. After China renewed enforcement of its mining ban, hashpower slid, pushing difficulty lower. At the same time, miners facing soaring electricity bills outside China have begun switching off gear or selling portions of their treasuries to stay solvent.
JPMorgan pegs miners’ average cost basis near $90,000 per BTC, meaning revenue margins have evaporated at today’s prices — a dynamic that usually sparks capitulation.
Why MSTR Matters More Than Miner Flows
While these stress signals explain some selling pressure, the bank insists they are secondary to what Strategy’s balance sheet is signaling.
To measure that, JPMorgan tracks how much the firm’s enterprise value exceeds the value of its Bitcoin holdings. That premium collapsed this year but still sits comfortably above 1.0 — a level the bank interprets as evidence that Strategy is not being forced toward liquidation.
The firm has also strengthened its liquidity profile.
In November, Strategy revealed a $1.44 billion cash safety buffer — enough to service dividends and interest obligations for up to two years. JPMorgan argues this pile of dollars drastically reduces any need to offload Bitcoin, calming broader market fears.
Even though Strategy momentarily paused its usual buying pace — including one week without any accumulation — the firm’s Bitcoin mountain grew past 650,000 BTC. To JPMorgan, that signals conviction rather than fatigue.
The MSCI Plot Twist Appears Fully Discounted
Market chatter has largely centred on whether MSCI will remove Strategy from major equity indices, a move that would normally pressure a stock that ETF allocators are forced to sell.
The bank believes this drama has already played out in price: Strategy’s shares have nosedived roughly 40% since MSCI first floated the review in October, underperforming Bitcoin by wide margins. That decline erased an estimated $18 billion in equity value — enough, JPMorgan argues, to reflect worst-case assumptions.
If MSCI follows through with removal, downside should be limited. If it doesn’t, the bank expects an outsized rebound in both MSTR and BTC.
A Soft Floor and a High Ceiling
JPMorgan continues to point to production costs as a psychological bottom for Bitcoin — if prices sit below $90,000 too long, weaker miners break first, eventually lowering the estimated floor but typically marking a cleansing phase.
Looking further, the bank reiterates its long-term bullish framework: adjusted for volatility relative to gold markets, Bitcoin’s “fair value” remains near $170,000 — a level analysts say could come into view next year if macro conditions stop deteriorating.
In short, JPMorgan’s message is simple: miners may be hurting, but Strategy’s ability to avoid panic selling is now the bigger determinant of where Bitcoin goes next.
