Wells Fargo Predicts $150B Could Flow Into Bitcoin and Equities From Tax Refunds

Larger tax refunds anticipated for US filers in 2026 could drive significant capital into cryptocurrency and equity markets, according to a Wells Fargo analysis ^[1].

Analyst Ohsung Kwon estimates that approximately $150 billion may enter equities and Bitcoin by late March, driven by what he characterizes as a return of speculative "YOLO" trading behavior. The strategist suggests that higher-income taxpayers will likely direct their increased refunds toward risk assets, including Bitcoin and retail-favorite stocks such as Robinhood and Boeing ^[1].

The projected larger refunds stem from provisions in President Donald Trump's One Big Beautiful Bill Act, which became law on July 4, 2025, and includes favorable tax treatment for 2025 filings ^[1].

However, crypto research analyst Nicolai Sondergaard from Nansen cautioned that actual flows into digital assets will depend heavily on market sentiment and momentum. He noted that current economic conditions differ from the pandemic era, with higher inflation and consumer spending potentially affecting investment decisions ^[1].

Meanwhile, market data shows contrasting behavior among different investor groups. Large holders have been accumulating spot cryptocurrencies, with over $41.9 million in Ethereum purchases across 22 wallets last week. However, sophisticated traders tracked as "smart money" held net short positions totaling $107 million on Bitcoin ^[1].