JPMorgan Highlights MicroStrategy’s Growing Role in Crypto Markets Through Leveraged ETFs

JPMorgan: Leveraged MicroStrategy ETFs Are Becoming a Key Driver in Stock and Crypto Markets

According to a recent research report from JPMorgan (JPM), the rising size and inflows of leveraged MicroStrategy (MSTR) exchange-traded funds (ETFs) are having an increasingly significant impact on both the company’s stock and the wider cryptocurrency markets.

The report noted that these leveraged ETFs played a crucial role in boosting MicroStrategy’s stock by nearly 60% in November. The total flow of funds into U.S. spot bitcoin (BTC), spot ether (ETH), and leveraged MicroStrategy ETFs reached nearly $11 billion during the month. Of this, $3.4 billion—approximately one-third—was attributed to the leveraged MSTR ETFs.

“This underscores the growing impact of MicroStrategy’s leveraged ETFs in the crypto sector, particularly by supporting the company’s ongoing bitcoin acquisition strategy,” wrote analysts, led by Nikolaos Panigirtzoglou.

Under Michael Saylor’s leadership, MicroStrategy has invested $13 billion in bitcoin this quarter alone, as noted in the report.

The growth of these ETFs is largely driven by rising investor demand for amplified exposure to bitcoin via an ETF format, which is not typically available to individual retail investors. The leveraged ETFs offer an indirect route for investors to gain bitcoin exposure, while also benefiting from MicroStrategy’s significant holdings. Additionally, MicroStrategy’s inclusion in major indices like the MSCI World index results in large passive investments flowing into its stock.

The report also pointed out that investor enthusiasm for MicroStrategy’s long-term strategy—such as its goal to become a bitcoin bank and develop BTC-based applications—has led to a premium being added to its stock price, increasing the company’s overall valuation.

According to Benchmark analyst Mark Palmer, MicroStrategy now meets the eligibility criteria for inclusion in the Nasdaq-100 index.