U.S. Tax Refunds Could Inject $150B of Liquidity Into Crypto Markets

An influx of U.S. tax refunds could provide a near-term liquidity boost for cryptocurrency markets, potentially lifting retail participation as prices hover near key technical levels.U.S. taxpayers are expected to receive around $150 billion in tax refunds by the end of March 2026, supported by recent tax cuts and fiscal incentives, according to analysis cited by NS3.AI.Historically, a portion of tax refunds has flowed into risk assets, including equities and cryptocurrencies, as households deploy excess cash beyond immediate consumption. Analysts say the timing is notable, as the refund window coincides with crypto markets trading near important breakout and resistance zones.Market observers argue that an incremental rise in retail inflows—layered on top of existing institutional activity—could amplify volatility and increase the likelihood of short squeezes, particularly in assets with crowded derivatives positioning.While not all refunds are expected to reach crypto markets, even a modest allocation could meaningfully impact short-term demand and trading volumes, given the sector’s relatively smaller size compared with traditional asset classes. Analysts caution that the effect will depend on broader risk sentiment and macro conditions but view the refund season as a potential catalyst worth monitoring.