Crypto market outlook for 2026
Year 2025 was volatile, as crypto often is. Among positive catalysts were favourable regulatory changes in the U.S., rise of Digital Asset Treasuries (DAT), adoption of AI and tokenization of Real-World-Assets (RWA).
The majors including Bitcoin (BTC), Ethereum (ETH), Ripple (XRP) and Binance Coin (BNB) made new All-Time-Highs (ATH).
Yet, the momentum fizzled in the second half of the year in part due to macro-economic uncertainty (tariffs, inflation, Fed rates) and the flash crash on Oct 10th that wiped out a lot of over-leveraged investors.
After trading up 34% and 43% at their peaks, BTC and ETH have given up all those gains and are now down -7% and -12%. Meanwhile, privacy coins like Zcash (ZEC) and Monero (XMR), and exchange coins (BNB, OKB, KCS, HYPE) have outperformed.
After a volatile 2025, I anticipate a bullish turn in 2026, propelled by macroeconomic shifts and growing institutional momentum.
The U.S. Federal Reserve is expected to ease monetary policy as U.S. headline and core inflation cool, potentially lowering interest rates and rekindling investor appetite for risk assets.
Spot Bitcoin and Ether ETFs funds could absorb over 100% of new BTC and ETH issuance while policymakers in the U.S. move to integrate stablecoins into mainstream finance, spurring competition between crypto issuers and traditional banks for digital dollar dominance.
Meanwhile, tokenization of real-world assets (RWA) is at an inflection point, with on-chain RWA volumes poised to expand from billions toward trillions of dollars.
Which sectors could outperform in 2026?
Bitcoin & Layer-1s: Bitcoin remains the industry’s anchor with a robust monetary narrative. Its fixed supply and growing adoption position it for potential new highs.
Ethereum & Layer-2s: Ethereum enters 2026 strengthened by recent upgrades that lowered Layer-2 fees, boosting scalability and user activity. A proliferation of L2 rollups and modular chains is expected, improving throughput without sacrificing security.
DeFi & Stablecoins: Decentralized finance is evolving to integrate real-world assets. Tokenized securities and interest-bearing stablecoins are set to become core collateral in DeFi, generating more sustainable on-chain yields. New DEX designs and modular lending protocols aim to enhance liquidity and risk management.
As for emerging sectors, Crypto-powered AI networks and tokenized physical infrastructure (DePIN) are also gaining traction.
Bittensor (TAO), a blockchain for decentralized AI, is emerging as a standout. Its network incentivizes developers to train and share machine learning models for token rewards. In late 2025 Bittensor underwent its first halving, cutting daily TAO emissions to 3,600 and mirroring Bitcoin’s 21 million supply cap.
Source: fxstreet
