Grayscale's 2026 Outlook: Top 10 New Investment Opportunities and False Hype in Crypto
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Grayscale's 2026 Outlook: Top 10 New Investment Opportunities and False Hype in Crypto
Bitcoin's price may reach a new all-time high in the first half of 2026.
Navigating Web3 tides with focused insightsAuthor: Grayscale
Translation: TechFlow
Key Takeaways
We expect 2026 to accelerate structural shifts in digital asset investing, driven primarily by two key trends: rising macro demand for alternative stores of value and increasing regulatory clarity. The convergence of these two forces is poised to attract greater capital inflows, expand the adoption of digital assets—particularly among wealth managers and institutional investors—and further integrate public blockchains into mainstream financial infrastructure.
As a result, we anticipate rising valuations across digital assets in 2026 and the end of the so-called "crypto four-year cycle" theory—the idea that crypto markets follow a predictable four-year rhythm. We believe Bitcoin’s price could reach a new all-time high in the first half of 2026.
Grayscale expects bipartisan-backed crypto market structure legislation to become U.S. law in 2026. This would further drive deeper integration between public blockchains and traditional finance, enable compliant trading of digital asset securities, and potentially allow startups and established companies to issue securities on-chain.
The outlook for fiat currencies is increasingly uncertain; in contrast, we can be highly confident that the 20 millionth Bitcoin will be mined by March 2026. As fiat risks rise, we believe digital systems like Bitcoin and Ethereum—due to their transparency, programmability, and ultimate scarcity—will become increasingly favored by market demand.
We expect more crypto assets to become available via exchange-traded products (ETPs) in 2026. These investment vehicles have seen early success, but many platforms are still conducting due diligence and working to incorporate crypto into their asset allocation processes. As this process matures, we anticipate a growing influx of slow-moving institutional capital entering the market in 2026.
In addition, we outline ten key themes for crypto investing in 2026, reflecting the broadening use cases emerging across public blockchain technology. For each theme, we include relevant crypto assets:
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Demand for monetary alternatives rises as USD depreciation risk grows
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Regulatory clarity supports digital asset adoption
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Stablecoin influence expands under the GENIUS Act
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Tokenization of assets reaches an inflection point
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Blockchain goes mainstream, privacy solutions become urgent
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AI centralization drives demand for blockchain solutions
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DeFi accelerates, lending leads the charge
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Mainstream adoption requires next-generation infrastructure
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Focus shifts to sustainable revenue models
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Investors default to seeking staking yields
Finally, we identify two topics that we believe will have limited impact on the crypto market in 2026:
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Quantum computing: While research and preparations for post-quantum cryptography continue, we do not expect this issue to significantly affect market valuations next year.
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Digital asset treasuries (DATs): Despite significant media attention, we do not believe DATs will be a major factor influencing the digital asset market in 2026.
Outlook for Digital Assets in 2026: Dawn of the Institutional Era
Fifteen years ago, cryptocurrency was merely an experiment: one asset (Bitcoin), with a market cap of about $1 million. Today, it has evolved into an emerging industry and mid-sized alternative asset class, comprising millions of tokens and a total market cap of approximately $3 trillion (see Figure 1). Increasingly robust regulatory frameworks across major economies are now driving deeper integration between public blockchains and traditional finance, paving the way for long-term capital inflows.
Figure 1: Cryptocurrency is now a mid-sized alternative asset class
Throughout crypto's evolution, token valuations have experienced four major cyclical drawdowns, roughly every four years (see Figure 2). In three of these cases, valuation peaks occurred 1 to 1.5 years after Bitcoin halving events, which happen every four years. The current bull market has lasted over three years, with the most recent Bitcoin halving occurring in April 2024—over 1.5 years ago. Thus, some market participants hold the conventional view that Bitcoin prices may have peaked in October 2025, making 2026 a challenging year for crypto returns.
Figure 2: Rising valuations in 2026 will mark the end of the "four-year cycle theory"
Grayscale believes the crypto asset class remains in a sustained bull market and predicts 2026 will mark the end of the explicit four-year cycle. We expect valuations to rise across all six major crypto sectors in 2026 and believe Bitcoin’s price could surpass its previous all-time high in the first half of the year.
Our optimistic outlook rests on two pillars:
First, growing macro demand for alternative stores of value.
Bitcoin and Ethereum, the two largest cryptocurrencies by market cap, can be viewed as scarce digital commodities and alternative monetary assets. Due to high public-sector debt and its potential long-term inflationary impact (see Figure 3), fiat currencies (and assets priced in fiat) face elevated risks. Whether physical gold and silver or digital Bitcoin and Ethereum, such scarce assets may serve as portfolio "ballast" against fiat risk. In our view, as long as the risk of fiat devaluation continues to rise, demand for Bitcoin and Ethereum in portfolios is likely to grow accordingly.
Figure 3: U.S. debt levels raise questions about credibility of low inflation
Second, regulatory clarity is driving institutional investment into public blockchain technology.
It may be overlooked, but until this year, the U.S. government was investigating or suing many leading crypto firms, including Coinbase, Ripple, Binance, Robinhood, Consensys, Uniswap, and OpenSea. Even now, exchanges and other crypto intermediaries operate without clear guidance on spot markets.
This is gradually improving. In 2023, Grayscale won its lawsuit against the SEC, paving the way for spot crypto exchange-traded products (ETPs). In 2024, spot Bitcoin and Ethereum ETPs launched. In 2025, Congress passed the GENIUS Act, regulating stablecoins, while regulators shifted their stance toward the industry, collaborating to provide clear guidance while maintaining focus on consumer protection and financial stability. Grayscale expects bipartisan-backed crypto market structure legislation to pass in 2026, further cementing blockchain-based finance within U.S. capital markets and enabling continued institutional inflows (see Figure 4).
Figure 4: Higher fundraising may signal growing institutional investor confidence
We believe new capital entering the crypto ecosystem will flow primarily through spot ETPs. Since the launch of U.S. Bitcoin ETPs in January 2024, global crypto ETPs have attracted $87 billion in net inflows (see Figure 5). While these products have achieved early success, integrating crypto into mainstream portfolios remains in its infancy. Grayscale estimates that less than 0.5% of assets managed by U.S. wealth advisors are currently allocated to crypto assets.[2] As more platforms complete due diligence, establish capital market assumptions, and incorporate crypto into model portfolios, this figure is expected to grow.
Beyond wealth advisors, early institutional adopters—including Harvard Management Company and Abu Dhabi sovereign wealth fund Mubadala—have already added crypto ETPs to their portfolios.[3] We expect this list to grow significantly by 2026.
Figure 5: Sustained inflows into spot crypto ETPs
As crypto markets become increasingly driven by institutional capital flows, their price behavior is changing. In prior bull runs, Bitcoin prices rose at least 1,000% within a single year (see Figure 6). This time, Bitcoin’s peak annual gain was around 240% (within the 12 months ending March 2024). We believe this difference reflects steadier institutional buying rather than the retail momentum-driven rallies of past cycles. While crypto investing remains risky, we believe the likelihood of a deep, prolonged cyclical downturn is relatively low at this stage. Instead, we expect steady price appreciation driven by institutional inflows to dominate in 2026.
Figure 6: Bitcoin did not spike sharply in this cycle
A supportive macro backdrop may also limit downside risks to token prices in 2026. The last two cyclical peaks occurred during periods of Federal Reserve rate hikes (see Figure 7). By contrast, the Fed cut rates three times in 2025 and is expected to continue cutting in 2026. Kevin Hassett, who may succeed Jerome Powell as Fed Chair, recently stated on Face the Nation: “The American people can expect that President Trump will choose someone who can help them get lower interest rates on car loans and easier access to low-rate mortgages.”[4] Overall, economic growth and a generally accommodative Fed policy should align with improved investor risk appetite and potential gains for high-risk assets, including crypto.
Figure 7: Previous cyclical peaks coincided with Fed rate hikes
Like all asset classes, crypto markets are driven by a combination of fundamentals and capital flows. Commodity markets are cyclical, and crypto may experience extended drawdowns at certain points in the future. However, we do not expect this to occur in 2026. Fundamentally, the crypto market shows strong support: we anticipate continued growth in macro demand for alternative stores of value and increasing regulatory clarity driving institutional investment into public blockchain technology. Additionally, new capital continues to enter: by year-end, crypto ETPs are expected to appear in more portfolios. Unlike past cycles marked by surges in retail demand, this cycle features sustained demand from diversified portfolios. Against a broadly supportive macro backdrop, we believe these conditions lay the foundation for crypto assets to reach new highs in 2026.
Top Ten Crypto Investment Themes for 2026
Crypto is a diverse asset class reflecting the wide range of applications enabled by public blockchain technology. Below, we outline Grayscale’s views on the ten most important crypto investment themes for 2026—along with two “distractions.” For each theme, we list the tokens most relevant from Grayscale’s perspective. For additional background on types of investable digital assets, please refer to our Crypto Sectors Framework.
Theme One: USD Depreciation Risk Fuels Demand for Monetary Alternatives
Relevant crypto assets: BTC, ETH, ZEC
The U.S. economy faces debt challenges (see Figure 3), which may ultimately undermine the dollar’s role as a store of value. Other countries face similar issues, but because the dollar is the dominant global currency, U.S. policy credibility has outsized influence on potential capital flows. In our view, only a few digital assets qualify as viable stores of value—those with broad adoption, high decentralization, and constrained supply growth. These include the two largest cryptocurrencies by market cap, Bitcoin and Ethereum. Like physical gold, their value derives partly from scarcity and autonomy.
Bitcoin’s supply is capped at 21 million and fully governed by programmed rules. For example, we can be certain the 20 millionth Bitcoin will be mined by March 2026. A transparent, predictable, and ultimately scarce digital currency system—though conceptually simple—is increasingly attractive in today’s economy amid tail risks in fiat currencies. As long as macro imbalances driving fiat risk continue to grow, portfolio demand for alternative stores of value may also keep rising (see Figure 8). Additionally, Zcash, a smaller decentralized digital currency with privacy features, may also suit portfolios hedging against USD depreciation (see Theme Five).
Figure 8: Macro imbalances may drive demand for alternative stores of value
Theme Two: Regulatory Clarity Supports Digital Asset Adoption
Relevant crypto assets: Nearly all crypto assets
In 2025, the U.S. made significant progress in crypto regulatory clarity, including passage of the GENIUS Act (for stablecoins), withdrawal of the SEC’s Staff Accounting Bulletin 121 (on custody), introduction of standardized listing criteria for crypto ETPs, and resolution of traditional banking access issues for the crypto industry (see Figure 9). Next year, we expect another major milestone: bipartisan-backed market structure legislation. The House passed its version—the Clarity Act—in July, and the Senate has initiated related proceedings. While many details remain unresolved, overall, this legislation would apply traditional financial rules to crypto capital markets, including registration and disclosure requirements, crypto asset classification, and insider trading rules.
In practice, clearer crypto regulations in the U.S. and other major economies may mean regulated financial services firms can report digital assets on their balance sheets and begin transacting on blockchains. It may also enable on-chain capital formation, allowing startups and mature companies to issue regulated tokens. By unlocking more of blockchain technology’s potential, regulatory clarity should broadly enhance the value of the crypto asset class. Given its potential importance in driving crypto adoption in 2026, we view any disruption to bipartisan legislative progress as a potential downside risk.
Figure 9: The U.S. made major strides in crypto regulatory clarity in 2025
Theme Three: GENIUS Act Drives Stablecoin Influence Growth
Relevant crypto assets: ETH, TRX, BNB, SOL, XPL, LINK
2025 was a breakout year for stablecoins: circulation reached $300 billion, with average monthly trading volume hitting $1.1 trillion over the six months ending November.[5] Additionally, Congress passed the GENIUS Act, triggering a surge of institutional capital into the sector (see Figure 10). In 2026, we expect to see tangible outcomes: stablecoins integrated into cross-border payment services, used as collateral on derivatives exchanges, appearing on corporate balance sheets, and serving as credit card alternatives for online payments. Growing popularity of prediction markets may also drive new stablecoin demand. Rising stablecoin transaction volumes are expected to benefit blockchains that record these transactions—such as ETH, TRX, BNB, and SOL—as well as supporting infrastructure (like LINK) and decentralized finance (DeFi) applications (see Theme Seven).
Figure 10: Stablecoins experience explosive growth
Theme Four: Tokenization of Assets Reaches an Inflection Point
Relevant crypto assets: LINK, ETH, SOL, AVAX, BNB, CC
Currently, asset tokenization remains small—just 0.01% of the total market cap of global stocks and bonds (see Figure 11). Grayscale expects rapid growth in coming years, driven by more mature blockchain technology and clearer regulations. A 1,000-fold increase in tokenized assets by 2030 would not be surprising. In our view, this growth will create value for blockchains processing tokenized asset trades—such as Ethereum, BNB Chain, and Solana—as well as various supporting applications. Among these, Chainlink (LINK) stands out due to its unique software toolkit.
Figure 11: Tokenized assets have massive growth potential
Theme Five: Blockchain Mainstreaming Demands Privacy Solutions
Relevant crypto assets: ZEC, AZTEC, RAIL
Privacy is a normal component of financial systems: nearly everyone wants their salary, taxes, net worth, and spending habits kept off public ledgers. Yet most blockchains are transparent by default. If public blockchains are to integrate more deeply into finance, they need stronger privacy infrastructure—a need amplified by regulatory efforts to integrate blockchain technology. Privacy features are gaining investor attention, with potential beneficiaries including Zcash (ZEC), a decentralized digital currency similar to Bitcoin but with privacy protections. Zcash saw a sharp price increase in Q4 2025 (see Figure 12). Other notable projects include Aztec (a privacy-focused Ethereum Layer 2) and Railgun (DeFi privacy middleware). We may also see rising adoption of confidential transactions on leading smart contract platforms like Ethereum (via ERC-7984) and Solana (via Confidential Transfers token extension). As privacy tools improve, better identity and compliance infrastructure will also be needed to support DeFi.
Figure 12: Investor interest in privacy features rises
Theme Six: AI Centralization Spurs Demand for Blockchain Solutions
Relevant crypto assets: TAO, IP, NEAR, WORLD
The fundamental alignment between crypto and artificial intelligence (AI) is tighter and clearer than ever. AI systems are increasingly concentrated among a few dominant firms, raising concerns about trust, fairness, and ownership—risks that crypto offers direct tools to address. Decentralized AI development platforms like Bittensor aim to reduce reliance on centralized AI tech; verifiable Proof of Personhood systems like World distinguish humans from synthetic agents in an age of rampant artificial activity; and networks like Story Protocol provide transparent, traceable intellectual property in an era when digital content origins are increasingly hard to verify. Tools like X402—an open, zero-fee stablecoin payment layer for Base and Solana—enable low-cost, instant micropayments, meeting the needs of agent-to-agent or machine-to-human economic interactions.
Together, these components form early infrastructure for an “Agent Economy,” where identity, computation, data, and payments must all be verifiable, programmable, and censorship-resistant. While still early and unevenly developed, the intersection of crypto and AI is generating some of the most compelling long-term use cases in the space. As AI becomes more decentralized, autonomous, and economically active, protocols building real infrastructure stand to benefit (see Figure 13).
Figure 13: Blockchain provides solutions to AI risks
Theme Seven: DeFi Accelerates, Lending Leads the Way
Relevant crypto assets: AAVE, MORPHO, MAPLE, KMNO, UNI, AERO, RAY, JUP, HYPE, LINK
Driven by technological advances and favorable regulation, decentralized finance (DeFi) applications made significant progress in 2025. Growth in stablecoins and tokenized assets were standout successes, but DeFi lending also expanded notably, particularly platforms led by Aave, Morpho, and Maple Finance (see Figure 14).[7] Meanwhile, decentralized perpetual futures exchanges like Hyperliquid now rival some of the largest centralized derivatives exchanges in terms of open interest and daily volume. Looking ahead, growing liquidity, interoperability, and integration with real-world pricing make DeFi a credible alternative for users seeking direct on-chain financial transactions. More DeFi protocols are expected to integrate with traditional fintech firms to leverage their infrastructure and user bases. Core DeFi protocols are likely to benefit—including lending platforms like AAVE, decentralized exchanges like UNI and HYPE, and infrastructure like LINK—as well as blockchains hosting much of the DeFi activity (e.g., ETH, SOL, BASE).
Figure 14: DeFi grows in scale and diversity
Theme Eight: Mainstream Adoption Requires Next-Gen Infrastructure
Relevant crypto assets: SUI, MON, NEAR, MEGA
New-generation blockchains are pushing the boundaries of technology. Yet some investors argue there’s no need for more blockspace, as existing chains haven’t reached full capacity. Solana was once a prime example—a fast chain with low usage, seen as emblematic of “excess blockspace”—but after a wave of adoption, it became one of the industry’s most successful cases. While not all high-performance blockchains today will follow this path, we expect a few to emerge as leaders. Superior technology doesn’t guarantee widespread adoption, but the architecture of these next-gen networks gives them unique advantages in emerging areas such as AI micropayments, real-time gaming loops, high-frequency on-chain transactions, and intent-based systems. In this space, we expect Sui to stand out due to its technical strengths and integrated development strategy (see Figure 15). Other promising projects include Monad (a parallelized EVM), MegaETH (an ultra-fast Ethereum Layer 2), and Near (an AI-focused blockchain whose Intents product gained traction).
Figure 15: Next-gen blockchains like Sui offer faster, lower-cost transactions
Theme Nine: Focus Shifts to Sustainable Revenue
Relevant crypto assets: SOL, ETH, BNB, HYPE, PUMP, TRX
Blockchains aren’t traditional companies, but they do have measurable fundamentals—users, transaction volume, fees, capital/total value locked (TVL), developers, and applications. Among these, Grayscale views transaction fees as the most valuable fundamental metric, as they are hardest to manipulate and most comparable across chains (and best fit empirical models). Transaction fees are analogous to “revenue” in traditional corporate finance. For blockchain applications, it’s also important to distinguish between protocol fees/revenue and “supply-side” fees/revenue.[8] As institutions begin allocating capital to crypto, we expect them to favor blockchains and applications with high and/or growing revenue (excluding Bitcoin). High-revenue smart contract platforms include TRX, SOL, ETH, and BNB (see Figure 16). High-revenue application-layer assets include HYPE and PUMP.
Figure 16: Institutions may focus more on blockchain fundamentals
Theme Ten: Investors Default to Staking
Relevant crypto assets: LDO, JTO
In 2025, U.S. policymakers made two adjustments in the staking space that will enable broader participation: (i) the SEC clarified that liquid staking activities do not constitute securities offerings[9]; and (ii) the IRS and Treasury announced that investment trusts/exchange-traded products (ETPs) can stake digital assets.[10] Guidance on liquid staking services may benefit leading liquid staking protocols on Ethereum and Solana—Lido and Jito—which lead in TVL.[11] More broadly, the ability of crypto ETPs to stake may make this the default structure for holding proof-of-stake (PoS) token positions, leading to higher staking ratios and downward pressure on reward rates[12] (see Figure 17). In this environment of broader staking adoption, custodial staking via ETPs offers a convenient way to capture rewards, while non-custodial, on-chain liquid staking retains composability advantages in DeFi. We expect this dual structure to persist for the foreseeable future.
Figure 17: Proof-of-Stake (PoS) tokens offer native yield
"Pseudo-Trends" for 2026
We expect each of the above investment themes to significantly shape crypto market developments in 2026. However, two popular topics—we believe—will have minimal real impact next year: the potential threat of quantum computing to cryptographic algorithms, and the evolution of digital asset treasuries (DATs). While both may generate considerable discussion, we do not consider them core drivers of market outlook.
If quantum computing continues advancing, most blockchains will eventually need to update their cryptographic algorithms. In theory, sufficiently powerful quantum computers could derive private keys from public keys, enabling valid digital signatures to spend users’ crypto.[13] Thus, Bitcoin and most other blockchains—and virtually every sector using cryptography—will eventually need to upgrade to quantum-resistant tools. However, experts estimate quantum computers won’t be capable of breaking Bitcoin’s cryptography before 2030.[14] While research and community preparation around quantum risks may accelerate in 2026, we believe this topic is unlikely to materially affect prices.
The same applies to digital asset treasuries (DATs). Michael Saylor’s strategy of holding digital assets on corporate balance sheets inspired dozens of followers in 2025. By our estimates, DATs hold 3.7% of BTC supply, 4.6% of ETH, and 2.5% of SOL.[15] However, demand peaked in mid-2025 and has since declined: the largest DATs now trade at mNAV multiples near 1.0 (see Figure 18). Still, most DATs are not over-leveraged (if at all), so even in a downturn, forced asset sales are unlikely. Strategy, the largest DAT by market cap, recently raised a USD reserve fund to continue paying dividends to preferred shareholders even if Bitcoin prices fall.[17] We expect most DATs to behave like closed-end funds, trading at premiums or discounts to NAV, with rare asset sales. While these instruments may become a lasting feature of crypto investing, we believe they are unlikely to be a major source of new demand or selling pressure in 2026.
Figure 18: DAT premiums have narrowed, but asset sales remain unlikely
Conclusion
We expect a bright outlook for digital assets in 2026, driven by two main forces: rising macro demand for alternative stores of value and increasing regulatory clarity. Next year, connections between blockchain finance and traditional finance will deepen, and institutional capital inflows will become a defining trend. Tokens most likely to attract institutional adoption will be those with clear use cases, sustainable revenue streams, and access to regulated trading venues and applications. Investors can expect richer choices of crypto assets via exchange-traded products (ETPs), with staking functionality where possible.
At the same time, regulatory clarity and institutional adoption may raise the bar for crypto assets entering the mainstream. For example, certain crypto projects may need to meet new registration and disclosure requirements to access regulated exchanges. Moreover, institutional investors may overlook crypto assets lacking clear use cases, even if their market caps are relatively high. The GENIUS Act already distinguishes regulated payment stablecoins (which enjoy specific rights and responsibilities under U.S. law) from others that do not. Similarly, we expect a widening gap between assets with access to regulated trading venues and institutional capital and those without, as crypto enters its institutional era. Not all tokens will successfully transition into this new phase.
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