Interpreting the CoinShares 2026 Report: Moving Beyond Speculative Narratives, Embracing the Year of Utility
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Interpreting the CoinShares 2026 Report: Moving Beyond Speculative Narratives, Embracing the Year of Utility
2026 is expected to be the year "utility wins," where digital assets no longer aim to replace traditional financial systems but instead enhance and modernize existing ones.
Navigating Web3 tides with focused insightsAuthor: CoinShares
Translation: TechFlow
At year-end, institutional reviews and outlook reports are being released one after another.
Following the "too long; didn't read" principle, we attempt to quickly summarize these lengthy reports.
This report comes from CoinShares, a leading European digital asset investment management firm founded in 2014 with headquarters in London, UK, and Paris, France, managing over $6 billion in assets.
The 77-page "Outlook 2026: The Year Utility Wins" covers core topics including macroeconomic foundations, Bitcoin mainstreaming, the rise of hybrid finance, smart contract platform competition, and evolving regulatory landscapes, with in-depth analysis of stablecoins, tokenized assets, prediction markets, mining transformation, and venture capital.
Below is our distilled summary of the key points from this report:
1. Core Theme: The Arrival of the Year of Utility
2025 marks a turning point for the digital asset industry, with Bitcoin reaching new all-time highs and the sector shifting from speculation-driven to utility-driven value.
2026 is expected to be the “Year Utility Wins,” where digital assets no longer aim to replace traditional financial systems but instead enhance and modernize existing ones.
The report's central thesis is that 2025 signifies a decisive shift of digital assets from speculation-driven to utility-driven models, and 2026 will be the critical year when this transformation accelerates.
Digital assets are no longer attempting to build parallel financial systems but are enhancing and modernizing existing traditional financial infrastructure. The integration of public blockchains, institutional liquidity, regulated market structures, and real-world economic use cases is advancing faster than even optimistic projections.
2. Macroeconomic Foundations and Market Outlook
Economic Environment: Soft Landing on Thin Ice
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Growth Outlook: The economy may avoid recession in 2026, but growth will be weak and fragile. Inflation continues to ease but not decisively, while tariff disruptions and supply chain restructurings keep core inflation at levels not seen since the early 1990s.
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Fed Policy: Gradual rate cuts are expected, with target rates possibly falling into the mid-3% range, though the process will be slow. The Fed remains cautious due to its experience with the 2022 inflation surge and is reluctant to pivot quickly.
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Three Scenario Analysis:
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Optimistic Scenario: Soft landing plus productivity surprise—Bitcoin could exceed $150,000
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Base Case: Slow expansion—Bitcoin trades between $110,000–$140,000
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Bearish Scenario: Recession or stagflation—Bitcoin could fall to $70,000–$100,000 range
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Gradual Erosion of Dollar Reserve Status
The dollar’s share in global foreign exchange reserves has declined from 70% in 2000 to the mid-50% range today. Emerging market central banks are diversifying holdings, increasing allocations to assets like the yuan and gold. This creates structural tailwinds for Bitcoin as a non-sovereign store of value.
3. Bitcoin Mainstreaming in the U.S.
2025 saw several key breakthroughs in the United States, including:
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Approval and launch of spot ETFs
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Formation of top-tier ETF options markets
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Lifting of retirement plan restrictions
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Application of fair-value accounting rules for corporations
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The U.S. government designating Bitcoin as a strategic reserve
Institutional Adoption Still Early
Despite the removal of structural barriers, actual adoption remains limited by legacy financial processes and intermediaries. Wealth management channels, retirement providers, and corporate compliance teams are still adapting gradually.
Outlook for 2026
Key private-sector progress is expected: the four major brokerages opening Bitcoin ETF allocations, at least one major 401(k) provider allowing Bitcoin exposure, at least two S&P 500 companies holding Bitcoin, and at least two major custodial banks offering direct custody services.
4. Miner and Corporate Holding Risks
Explosive Growth in Corporate Holdings
From 2024 to 2025, publicly listed companies increased their Bitcoin holdings from 266,000 BTC to 1,048,000 BTC, with total value rising from $11.7 billion to $90.7 billion. Strategy (MSTR) accounts for 61%, with the top 10 firms controlling 84%.
Potential Selling Pressure
Strategy faces two major risks:
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Inability to fund perpetual debt and cash flow obligations (annual cash burn near $680 million)
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Refinancing risk (next bond maturity in September 2028)
If mNAV approaches 1x or zero-interest refinancing becomes unavailable, forced Bitcoin sales could trigger a negative feedback loop.
Options Markets and Declining Volatility
The development of IBIT options markets has reduced Bitcoin volatility—a sign of maturation. However, lower volatility may weaken demand for convertible bonds, reducing corporate purchasing power. A turning point in declining volatility emerged in spring 2025.
5. Diverging Regulatory Landscapes
EU: Clarity via MiCA
The EU has the world’s most comprehensive legal framework for crypto assets, covering issuance, custody, trading, and stablecoins. However, in 2025, coordination limits emerged, with some national regulators potentially challenging cross-border passporting.
U.S.: Innovation Amid Fragmentation
The U.S. regained momentum thanks to its deep capital markets and mature venture ecosystem, but regulation remains fragmented across the SEC, CFTC, and Federal Reserve. Stablecoin legislation (GENIUS Act) has passed, though implementation is ongoing.
Asia: Converging Toward Prudent Regulation
Hong Kong, Japan, and others are advancing Basel III-style crypto capital and liquidity requirements. Singapore maintains a risk-based licensing regime. Asia is forming a more coherent regulatory bloc, converging around risk-based frameworks and bank-aligned standards.
Rise of Hybrid Finance
Infrastructure and Settlement Layer
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Stablecoins: Market exceeds $300 billion, with Ethereum dominant and Solana growing fastest. The GENIUS Act requires compliant issuers to hold U.S. Treasury reserves, creating new demand for Treasuries.
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Decentralized Exchanges: Monthly volume exceeds $600 billion, with Solana processing up to $40 billion daily.
Tokenization of Real-World Assets (RWA)
Total value of tokenized assets grew from $15 billion at the start of 2025 to $35 billion. Tokenized private credit and U.S. Treasuries show fastest growth, with gold tokens exceeding $1.3 billion. BlackRock’s BUIDL fund expanded significantly, and JPMorgan launched JPMD tokenized deposits on Base.
Revenue-Generating On-Chain Applications
An increasing number of protocols generate hundreds of millions in annual revenue, distributing it to token holders. Hyperliquid uses 99% of revenue for daily token buybacks, while Uniswap and Lido have introduced similar mechanisms. This marks a shift of tokens from pure speculative assets toward equity-like instruments.
7. Stablecoin Dominance and Corporate Adoption
Market Concentration
Tether (USDT) holds 60% of the stablecoin market, Circle (USDC) 25%. New entrants like PayPal’s PYUSD face strong network effects, making it difficult to challenge the duopoly.
Corporate Adoption Outlook for 2026
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Payment Processors: Visa, Mastercard, Stripe have structural advantages and can switch to stablecoin settlement without changing front-end user experiences.
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Banks: JPMorgan’s JPM Coin has demonstrated potential, with Siemens reporting 50% FX savings and settlement times dropping from days to seconds.
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E-commerce Platforms: Shopify now accepts USDC checkout, and pilot programs for stablecoin supplier payments are underway in Asia and Latin America.
Revenue Implications
Stablecoin issuers face interest rate decline risks: if the Fed rate drops to 3%, an additional $88.7 billion in stablecoins must be issued to maintain current interest income.
8. Exchange Competition Using Porter’s Five Forces
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Existing Rivals: Intense and growing competition, with fee rates falling to low single-digit basis points.
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Threat of New Entrants: Traditional financial institutions like Morgan Stanley E*TRADE and Charles Schwab are preparing to enter but will rely on partners in the short term.
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Supplier Bargaining Power: Stablecoin issuers (e.g., Circle) strengthen control through Arc mainnet. Coinbase’s revenue-sharing agreement with Circle on USDC is crucial.
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Buyer Bargaining Power: Institutional clients account for over 80% of Coinbase’s trading volume, giving them strong leverage. Retail users are price-sensitive.
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Threat of Substitutes: Decentralized exchanges like Hyperliquid, prediction markets like Polymarket, and CME crypto derivatives pose competitive threats.
Industry consolidation is expected to accelerate in 2026, with exchanges and large banks acquiring customers, licenses, and infrastructure through M&A.
9. Smart Contract Platform Competition
Ethereum: From Sandbox to Institutional Infrastructure
Ethereum achieves scalability via its rollup-centric roadmap, with Layer-2 throughput increasing from 200 TPS a year ago to 4,800 TPS. Validators are pushing to increase base-layer gas limits. Spot Ethereum ETFs in the U.S. attracted approximately $13 billion in inflows.
In institutional tokenization, BlackRock’s BUIDL fund and JPMorgan’s JPMD showcase Ethereum’s potential as an institutional-grade platform.
Solana: High-Performance Paradigm
Solana stands out with its highly optimized monolithic execution environment, capturing about 7% of DeFi’s total TVL. Stablecoin supply exceeds $12 billion (up from $1.8 billion in January 2024), RWA projects are expanding, and BlackRock’s BUIDL grew from $25 million in September to $250 million.
Technical upgrades include the Firedancer client and the DoubleZero validator communication network. The spot ETF launched on October 28 has already attracted $382 million in net inflows.
Other High-Performance Chains
New-generation Layer-1s such as Sui, Aptos, Sei, Monad, and Hyperliquid compete through architectural differentiation. Hyperliquid focuses on derivatives, capturing over one-third of blockchain-generated revenue. However, the market is highly fragmented, and EVM compatibility has become a competitive advantage.
10. Mining Transformation into HPC (High-Performance Computing)
Expansion in 2025
Listed miners added 110 EH/s of computing power, primarily from Bitdeer, HIVE Digital, and Iris Energy.
HPC Transition
Miners have announced $65 billion worth of HPC contracts, and Bitcoin mining revenue is expected to drop from 85% to under 20% of total revenue by end-2026. HPC operations achieve operating margins of 80–90%.
Future Mining Models
Future mining will likely be dominated by: ASIC manufacturers, modular mining, intermittent mining (coexisting with HPC), and sovereign-state mining. In the long run, mining may revert to small-scale, decentralized operations.
11. Venture Capital Trends
Recovery in 2025
Crypto VC funding reached $18.8 billion, surpassing 2024’s full-year total of $16.5 billion. Driven by large deals: Polymarket secured a $2 billion strategic investment (ICE), Stripe’s Tempo raised $500 million, and Kalshi raised $300 million.
Four Trends for 2026
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RWA Tokenization: Securitize’s SPAC and Agora’s $50 million Series A reflect growing institutional interest.
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AI-Crypto Integration: Applications such as AI agents and natural language trading interfaces are accelerating.
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Retail Investment Platforms: Platforms like Echo (acquired by Coinbase for $375 million) and Legion are emerging as decentralized angel investing platforms.
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Bitcoin Infrastructure: Projects related to Layer-2 and Lightning Network are gaining attention.
12. Rise of Prediction Markets
Polymarket achieved weekly trading volumes exceeding $800 million during the 2024 U.S. election, with strong post-election activity. Its predictive accuracy was validated: events assigned 60% probability occurred ~60% of the time, and those at 80% probability materialized 77–82% of the time.
In October 2025, ICE made a strategic investment of up to $2 billion in Polymarket, signaling recognition by mainstream financial institutions. Weekly trading volume could exceed $2 billion in 2026.
13. Key Conclusions
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Accelerated Maturation: Digital assets are shifting from speculation-driven to utility- and cash-flow-driven models, with tokens increasingly resembling equity assets.
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Rise of Hybrid Finance: The convergence of public blockchains and traditional financial systems is no longer theoretical—it is visible through robust growth in stablecoins, tokenized assets, and on-chain applications.
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Improved Regulatory Clarity: The U.S. GENIUS Act, EU MiCA, and Asia’s prudent regulatory frameworks lay the foundation for institutional adoption.
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Gradual Institutional Adoption: Despite removed structural barriers, real adoption will take years. 2026 will be a year of incremental private-sector progress.
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Reshaped Competitive Landscape: Ethereum remains dominant but faces challenges from high-performance chains like Solana, with EVM compatibility becoming a key advantage.
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Risks and Opportunities Coexist: High concentration of corporate holdings poses selling risks, while emerging areas such as institutional tokenization, stablecoin adoption, and prediction markets offer significant growth potential.
Overall, 2026 will be a pivotal year for digital assets—transitioning from the periphery to the mainstream, from speculation to utility, and from fragmentation to integration.
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