MicroStrategy (MSTR) and other crypto treasury stocks remained in focus on Thursday after JPMorgan analysts sounded the alarm on investing in companies functioning primarily as Bitcoin (BTCUSD) funds rather than traditional operating businesses.
Their warning arrives shortly after MicroStrategy faced rejection in joining the S&P 500 Index ($SPX) despite meeting technical requirements, which JPMorgan dubbed a major “blow not only to MSTR but to other corporate crypto treasuries” as well.
This development could have far-reaching implications as other providers might reconsider their approach to including crypto treasury companies in their indices.
Why JPM Is Against Investing in Crypto Treasury Stocks
JPMorgan cautions against investing in crypto treasury firms mostly because the sustainability of that corporate model is increasingly being questioned.
The traditional correlation between Bitcoin’s price movements and crypto-related stocks continues to intensify, creating heightened volatility risk for these equities.
Recent market data signal crypto treasury companies are seeing increased scrutiny from traditional financial institutions, with the Nasdaq implementing stricter supervision on firms pivoting to become BTC proxies.
According to JPM analysts, these crypto stocks also run the risk of “overcrowdedness and investor fatigue,” which makes them even less attractive to own in the second half of 2025.
How JPM Recommends Playing Crypto Stocks
For investors interested in building positions in crypto-related stocks, JPMorgan prefers companies with real operating businesses like exchanges or miners, rather than pure crypto treasury plays.
According to its experts, the market is demonstrating increased sophistication as investors begin to differentiate between companies based on their business models rather than merely their Bitcoin exposure.
Companies like Galaxy Digital (GLXY) (up 65% YTD) and Bitfarms (BITF) (up 35% YTD) have seen substantial gains driven by strategic moves into artificial intelligence (AI) and high-performance computing sectors, while pure BTC treasury vehicles have experienced notable declines. MicroStrategy shares remain up more than 12% in the year to date but are off nearly 20% over the past month.
This trend suggests that successful crypto-related companies must diversify beyond simple Bitcoin exposure and demonstrate clear technological innovation or ecosystem development.
This article was created with the support of automated content tools from our partners at Sigma.AI. Together, our financial data and AI solutions help us to deliver more informed market headline analysis to readers faster than ever. On the date of publication, Wajeeh Khan did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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