Sales of Bitcoin reserves create only temporary pressure on the market. The real structural threat to Bitcoin, according to JPMorgan analysts, is the development of private blockchain infrastructure. This was reported by The Block.
The bank outlined a negative scenario where tokenization, payments, and settlements continue to migrate to closed networks.
If this occurs, the broader crypto ecosystem risks facing a "structural derating"—a slowdown in activity, reduced liquidity, and weakened capital flows, ultimately impacting Bitcoin.
According to JPMorgan, institutional adoption has so far favored blockchains with restricted access, as they offer a higher level of privacy, AML/KYC controls, direct management, and regulatory certainty.
"This creates a competitive threat to public blockchains like Ethereum," the analysts stated.
JPMorgan also mentioned the position of the Bank for International Settlements (BIS), which has warned about the risks of using public blockchains in systemically important financial infrastructure. Instead, the BIS advocates for unified ledgers with permissioned access that integrate central bank digital currencies, commercial bank deposits, and tokenized assets in a regulated environment.
If such solutions gain widespread adoption, especially in non-transferable forms preferred by regulators, the need for stablecoins for institutional payments and settlements could significantly decrease. This trend could be further reinforced by the SWIFT blockchain initiative and CBDC projects.
Analysts also questioned the effectiveness of settlements through public networks: deferred and netting operations reduce the need for liquidity, enhance capital efficiency, and better align with funding management practices.
Even the potential approval of the CLARITY Act, in JPMorgan's view, may not eliminate risks. Clearer rules for digital assets could simultaneously stimulate the development of bank tokenized deposits, strengthening the positions of existing financial institutions and limiting the role of stablecoins based on public blockchains.
As an alternative, analysts proposed a hybrid model combining the functions of public and private protocols.
Recall that in June, JPMorgan pointed to a deterioration in the Bitcoin mining economy, as the asset has been trading below its production cost for an extended period.