Crypto’s 2026 Comeback Hinges On Three Outcomes, Wintermute Says

Bitcoin’s muted 2025 rally and fading altcoin cycle point to a structural market shift, leaving crypto’s 2026 outlook tied to institutions, rates and retail return.

2025 proved disappointing for many cryptocurrency investors, as Bitcoin’s traditional four-year cycle delivered a more muted rally that failed to spill over into the broader altcoin market. According to crypto market maker Wintermute, the shift reflects a structural change rather than a temporary pause, leaving any recovery in 2026 dependent on several uncertain factors.

In its digital asset OTC market review, Wintermute said the market’s long-standing pattern of “recycling,” in which gains in Bitcoin (BTC) and Ether (ETH) flowed into altcoins and fueled extended, narrative-driven rallies, broke down in 2025.

Instead, liquidity concentrated in a small group of large-cap assets, driven largely by exchange-traded funds (ETFs) and institutional inflows. The result was narrower market breadth and sharper divergence in performance, suggesting that capital became more selective rather than broadly rotating across the market.

As debate continues over whether Bitcoin’s four-year cycle is weakening or has fundamentally changed, Wintermute argued that the outlook for 2026 is far less predictable.

“2025 provided evidence that the traditional four-year cycle is becoming obsolete,” Wintermute said, adding:

For conditions to improve in 2026, Wintermute said at least one of three developments would need to occur: ETFs and digital asset treasury companies expand their mandates beyond Bitcoin and Ether; the major assets post another strong performance capable of generating a broader wealth effect; or retail investor attention returns, which is currently focused on artificial intelligence, equities and commodities.

Related: Wall Street’s crypto debate is over as banks go all-in on BTC, stablecoins, tokenized cash

Bringing retail investors back into crypto will not be easy. Institutional participation has played an increasingly dominant role in driving Bitcoin’s price higher, while memories of the 2022–2023 bear market — marked by steep losses, high-profile bankruptcies and forced liquidations — remain fresh.

At the same time, investors have found no shortage of alternative opportunities offering stronger returns.

Source: CoinTelegraph