Wall Street banking giant JPMorgan is forecasting a continuation — and potential acceleration — of capital inflows into the cryptocurrency market in 2026, driven increasingly by institutional investors following a record year in 2025. Analysts at the firm say the trend underscores growing confidence in digital assets as a legitimate investment class. According to JPMorgan’s latest research, total capital flowing into crypto markets reached nearly $130 billion in 2025, marking a roughly one-third increase from 2024 and setting a new annual record. This announcement followed Nikolaos Panigirtzoglou, Managing Director of Global Market Strategy at JPMorgan, and his team’s public assertion that the projected surge in institutional investment activities for this year should be primarily driven by newly released crypto regulations, such as the Clarity Act in the United States. Additionally, with these regulations present in the market, the JPMorgan executive claimed that more institutions will demonstrate heightened interest in embracing the use of cryptocurrencies and improve crypto-related activities like crypto venture capital funding, mergers and acquisitions, and initial public offerings in significant sectors comprising stablecoin issuers , payment firms, exchanges, wallet providers, blockchain infrastructure, and custody services. JPMorgan analysts anticipate an increase in institutional investment activities in the crypto industry To determine the total capital flows into crypto markets, JPMorgan analysts considered several key factors. These factors include flows from exchange-traded funds (ETFs), trends proposed by CME futures, fundraising for crypto ventures, and purchases of digital asset treasuries (DAT). Regarding last year’s rise, the analysts argued that the escalation primarily resulted from inflows into BTC and Ether ETFs, which, according to them, were likely driven by retail investors. Apart from this finding, they also discovered that DAT firms initiated considerable, off-strategy investments in Bitcoin. As significant investments in the crypto ecosystem sparked excitement in the crypto community, sources noted that the industry also experienced a drastic decline in purchasing activity related to Bitcoin and Ethereum CME futures in 2025 compared to the previous year. At this particular moment, institutional investors and hedge funds reduced their engagement in the industry. Meanwhile, it is worth noting that in 2025, over 50% of the funds directed into digital assets, which were approximately $68 billion, originated from Digital Asset Trusts . Strategy Inc. alone contributed around $23 billion of the total funds. This figure is comparable to the $22 billion specifically allocated for the purchase of Bitcoin in 2024. In addition, other DATs purchased approximately digital assets worth $ 45 billion last year, representing a sharp rise from the $8 billion recorded the previous year. As these publicly traded firms conducted these purchases, they did so at the beginning of the year. In October, they reduced their purchasing power. Some of the activities impacted by this decision included the purchases of significant players in the industry, such as Strategy and BitMine. Crypto venture capital funding encounters sluggish growth Analysts noted that crypto venture capital funding also contributed to the broader flow of capital. However, they alleged that its contribution was significantly lower than the peaks recorded in the years 2021 and 2022. In the meantime, reports indicated that while the total number of crypto venture capital funding experienced minor growth last year compared to 2024, the number of agreements struck drastically decreased, driven by a shift in focus among individuals who opted for later-stage rounds. At this time, funding for early-stage initiatives also dropped sharply across the year. To several analysts, the sluggish growth observed in crypto venture capital funding came as a surprise, given that US regulations are establishing a conducive environment for crypto-related activities. Join a premium crypto trading community free for 30 days - normally $100/mo.
