JPMorgan analysts stated that Bitcoin sales by Strategy Inc. create periodic selling pressure but do not represent the main structural threat to the cryptocurrency. According to a note published on Thursday, the larger risk stems from financial institutions adopting blockchain technology in ways that bypass public networks entirely. If tokenization, payments, and settlement move to permissioned infrastructure controlled by banks, the broader crypto ecosystem faces slower activity, lower liquidity, and weaker capital flows over time.

The Real Threat Is Banks Building Their Own Blockchains

Analysts led by managing director Nikolaos Panigirtzoglou argued that the more important risk is blockchain adoption within traditional finance continuing to develop in ways that bypass public permissionless networks. JPMorgan said institutional adoption has consistently favored permissioned blockchains because they offer better privacy controls, KYC compliance, clearer governance, and greater regulatory certainty.

Why Institutions Keep Choosing Private Blockchains

The Bank for International Settlements has explicitly warned against using public blockchains for systemically important financial infrastructure, instead promoting permissioned ledgers. Banks are already building their own blockchain infrastructure through tokenized deposits, which are digital versions of regular bank deposits backed by existing regulation. If these become widely adopted, they reduce the need for stablecoins in institutional payments. SWIFT’s blockchain initiative and central bank digital currency projects like the digital euro and digital yuan would strengthen that trend further.

Real World Assets May Never Move To Public Chains

The tokenized Real World Assets (RWA) market sits at around $50 billion, with a meaningful share hosted on Ethereum. JPMorgan said that likely reflects early experimentation rather than the long-term structure. As institutional adoption grows, issuance, custody, and settlement could increasingly move to private infrastructure. Public blockchains may still handle distribution but become less central to how institutions actually process transactions. DTCC is already developing tokenization workflows on permissioned infrastructure while only selectively connecting to public networks.

Even The CLARITY Act May Not Fix This

The analysts noted that even if the CLARITY Act passes this year, it may not eliminate these risks. Regulatory clarity could accelerate bank-issued tokenized deposits, strengthening incumbents while limiting the role of public blockchain stablecoins. Three scenarios could challenge JPMorgan’s view: a hybrid model where both blockchain types play meaningful roles, stronger stablecoin adoption from favorable regulation, or Bitcoin continuing to trade as digital gold regardless of how value accrues across the broader ecosystem.

Bitcoin extended gains to $63,183, alongside Ethereum, XRP, and Dogecoin, as market analysts debated whether a technical "death cross" signal indicates the final stages of the current bear market. This recovery follows a 32% decline in the first half of 2026, where Bitcoin fell from approximately $87,000 to around $58,500, driven by significant capital rotation into artificial intelligence equities and persistent high interest rates. The recent price action suggests a potential shift in sentiment, even as US spot Bitcoin ETFs recorded net outflows of $84.9 million on Wednesday, contrasting with inflows of $70.5 million into spot Ethereum ETFs.

Market Performance and Liquidations

The broader cryptocurrency market showed signs of recovery, with major assets posting gains. In the past 24 hours, 55,831 traders were liquidated for a total of $148.86 million. Top gainers during this period included Arbitrum, Celestia, and Canton. Despite the recent uptick, Bitcoin remains below its 20-week EMA of $71,565 and 50-week EMA of $80,642, levels that previously acted as resistance during the H1 selloff.

Technical Analysis and Trader Sentiment

Bitcoin is flashing a weekly death cross, where the 20-week EMA crossed below the 50-week EMA. However, traders such as Jelle and Titan argue that this signal has historically appeared late in bear markets rather than at the beginning, suggesting the downturn may be nearing its end. Analyst AshCrypto noted that Bitcoin has reclaimed its 200-week moving average, a key long-term support level, and is holding above $60,000 after bouncing from $57,000. Maintaining this level could pave the way for a historically strong rally in July and August.

Institutional Flows and Developments

While spot Bitcoin ETFs experienced outflows, the launch of Robinhood's blockchain—touted as ideal for real-world assets and meme coins—provided a tailwind for market sentiment. Exchange supplies for Bitcoin and Ethereum have hit historic lows, a metric some analysts view as bullish. Historical context remains a focus for investors, as successive negative returns in the first two quarters have previously preceded extended bear markets in 2018 and 2022.