Bitwise Chief: Bitcoin to Shatter Records in 2026 and Smash the Four-Year Cycle

Bitcoin's next bull run won't wait for the calendar.

Forget the old patterns. The four-year cycle that traders have leaned on for over a decade is about to break. The next surge isn't penciled in for 2028—it's coming in 2026.

The New Timeline

Institutional adoption is accelerating the clock. Major financial players aren't just dipping a toe anymore; they're building infrastructure and allocating capital at a pace that rewrites the playbook. This isn't retail FOMO—it's a structural shift in global asset allocation.

What Smashes the Cycle?

Traditional cycles were driven by halving events and retail sentiment. The new drivers are ETFs, corporate treasuries, and sovereign wealth funds. Their entry creates a demand shock that the old supply-side model can't predict. The market's plumbing has changed.

Records in the Crosshairs

Fresh all-time highs are the baseline expectation. The real story is the velocity. When the dam breaks, the move could be sharper and sustained longer than any previous rally, leaving chart-watchers who stuck to the old script scrambling—a classic Wall Street move, arriving late to the party only to complain about the music.

Bottom line: The countdown to the next peak just got cut in half. The market's rhythm is changing, and clinging to outdated cycles is a sure way to miss the beat.

Since the most recent halving occurred in April 2024, more than 18 months ago, traditional cycle theory WOULD predict 2026 as a down year.

However, Hougan argues that the forces driving previous cycles have weakened substantially, while new structural dynamics are taking hold.

“We believe the wave of institutional capital that began entering the space with the approval of spot Bitcoin ETFs in 2024 will accelerate in 2026, as platforms like Morgan Stanley, Wells Fargo, and Merrill Lynch begin allocating,” Hougan wrote in Bitwise’s annual predictions report.

He expects bitcoin to reach new all-time highs, relegating the four-year cycle to the dustbin of history.

Institutional Era Replaces Retail-Driven Volatility

Grayscale’s 2026 outlook echoes this transformation, projecting Bitcoin will set fresh records in the first half of next year as the market transitions into what it calls the institutional era.

The asset manager identifies two pillars supporting this view:

• Macro demand for alternative stores of value amid rising public debt
• Fiat currency risks, plus improving regulatory clarity that deepens blockchain integration with traditional finance.

The changing market structure has already altered Bitcoin’s price behavior. Previous bull markets saw gains exceeding 1,000% in a single year, while this cycle’s maximum year-over-year increase reached only 240% through March 2024.

Grayscale attributes this moderation to steadier institutional buying rather than retail momentum chasing, arguing the probability of deep, prolonged drawdowns has declined significantly.

Grayscale expects rising valuations in the crypto sector in 2026, and as a result, Bitcoin could exceed its previous high in the first half of the year.

Bitwise’s analysis also highlights how Bitcoin volatility has steadily decreased over the past decade, with BTC now less volatile than Nvidia throughout 2025.

Hougan predicts Bitcoin’s correlation with stocks will fall in 2026 as crypto-specific factors like regulatory progress and institutional adoption power the asset higher even if equities struggle.

Regulatory Clarity and Monetary Policy Alignment

Katherine Dowling, president of Bitcoin Standard Treasury Company, recently forecast that Bitcoin would reach $150,000 by the end of 2026, citing “the trifecta of a positive regulatory environment, quantitative easing, and institutional inflows.”

President TRUMP recently signed the GENIUS Act, establishing stablecoin regulatory framework, while the Office of the Comptroller of the Currency permitted national banks to offer crypto brokerage services.

Just this month, Bank of America now allows its financial advisers to recommend Bitcoin ETFs, potentially channeling portions of the bank’s $3.5 trillion in client assets into digital assets.

The Federal Reserve cut rates three times in 2025 and expects to continue easing next year.

Notably, Grayscale expects bipartisan crypto market structure legislation to become US law in 2026, which will solidify blockchain-based finance in capital markets.

Since US Bitcoin ETPs launched in January 2024, global crypto ETPs have attracted $87 billion in net inflows, yet less than 0.5% of US advised wealth is allocated to crypto.

On the technical level, according to a CryptoQuant analyst, on-chain data shows long-term holders distributing coins at one of the largest 30-day rates in the past 5 years, typically indicating late-cycle behavior.

However, CryptoQuant data also shows short-term holders are facing pressure, as Bitcoin has traded below their $104,000 cost basis since October 30, resulting in unrealized losses averaging 12.6%.

As reported by Cryptonews today, Bitcoin dropped nearly 4% to approximately $85,940 amid investor risk reduction ahead of crucial US economic data.

Despite near-term volatility, like other major players, Bitfinex maintains that the groundwork is being laid for BTC to regain all-time highs in 2026, supported by looser monetary policy and steady adoption by ETFs, corporates, and sovereign entities that are absorbing multiples of the yearly mined supply.