Protecting Bitcoin Gains - While Staying Invested
Dec 5, 2025
By Patrick McNamara
Bitcoin has increasingly become part of the modern portfolio conversation.
Blockchain adoption continues to expand. Institutional investors are increasing participation. Advisors are incorporating Bitcoin into diversified portfolios. And clients continue asking how to gain exposure responsibly.
Investors are drawn to the asset class for several reasons:
Limited supply and digital scarcity
Growing institutional acceptance
Integration into traditional financial markets
Potential hedge against currency debasement policies
But alongside that opportunity comes significant volatility. Even strong long-term trends can experience sharp corrections.
As we moved into early 2026, we recognized that volatility could increase. Rather than leaving clients fully exposed to another potential drawdown, we sought a way to help protect against additional losses while allowing them to remain invested and potentially recover recent declines more efficiently if markets rebounded.
To accomplish that, we worked directly with JP Morgan to structure a custom 3-year solution tied to the iShares Bitcoin Trust (IBIT), designed exclusively for our clients. The structure introduced defined downside parameters while providing 1.2x upside participation — meaning gains could compound at an accelerated rate during a recovery, subject to a capped return.
Investment Snapshot
Issuer: JP Morgan Chase
Underlying: iShares Bitcoin Trust (IBIT)
Pricing Date: February 5, 2026
Initial IBIT Price: $36.10
Term: 3 Years
Downside Protection: 100% principal protection up to a 40% decline
Upside Participation: 1.2x leverage
Maximum Return: 193.15% (capped)
Important Considerations
Investors should understand the specific characteristics of this structure:
Returns are capped at 193.15% over the 3-year term.
Downside protection applies only at maturity and only up to a 40% decline.
If IBIT declines more than 40% at maturity, losses begin beyond that threshold.
The investment is subject to the credit risk of JP Morgan as issuer.
Liquidity prior to maturity may be limited.
This is a debt security linked to IBIT — not direct ownership of Bitcoin or the ETF.
Each structured note has its own terms and risk profile. Careful review of offering documents is essential before investing. Security CUSIP: 46660JNR9
View the offering document here.
Final Thoughts
Bitcoin exposure does not have to mean accepting full volatility.
By combining defined downside protection with enhanced upside participation, this custom solution demonstrates how disciplined structuring can create a more thoughtful way to access emerging asset classes.
For investors seeking participation — not speculation — strategies like this can play a valuable role in portfolio construction.
By Patrick McNamara
CFP®, Financial Advisor at Claro Advisors
About the Author
Patrick McNamara, CFP® is a Financial Advisor at Claro Advisors
with nearly 30 years of experiencein the financial services industry.
He has held senior roles at Fidelity Investments, Goldman Sachs, and
Morgan Stanley. He founded StructuredNotes.com to educate investors
on institutional-style investment strategies and structured notes.
Disclosure: Claro Advisors Inc. (“Claro”) is a Registered Investment Advisor with the U.S. Securities and Exchange Commision (“SEC”) based in the Commonwealth of Massachusetts. Registration of an Investment Advisor does not imply a specific level of skill or training. Information contained herein is for educational purposes only and is not considered to be investment advice. Claro provides individualized advice only after obtaining all necessary background information from a client.
The investment products discussed herein are considered complex investment products. Such products contain unique features, risks, terms, conditions, fees, charges, and expenses specific to each product. The overall performance of the product is dependent on the performance of an underlying or linked derivative financial instrument, formula, or strategy. Return of principal is not guaranteed and is subject to the credit risk of the issuer. Investments in complex products are subject to the risks of the underlying reference asset classes to which the product may be linked, which include, but are not limited to, market risk, liquidity risk, call risk, income risk, reinvestment risk, as well as other risks associated with foreign, developing, or emerging markets, such as currency, political, and economic risks. Depending upon the particular complex product, participation in any underlying asset (“underlier”) is subject to certain caps and restrictions. Any investment product with leverage associated may work for or against the investor. Market-Linked Products are subject to the credit risk of the issuer. Investors who sell complex products or Market-Linked Products prior to maturity are subject to the risk of loss of principal, as there may not be an active secondary market. You should not purchase a complex investment product until you have read the specific offering documentation and understand the specific investment terms, features, risks, fees, charges, and expenses of such investment.
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