2025 was a painful year for the cryptocurrency market. Despite the arrival of a new U.S. president who claims to support cryptocurrencies, the approval of Bitcoin ETFs, and a gradually clearer regulatory framework, the market did not experience the anticipated frenzy. On the contrary, most altcoins suffered declines of 80% to 99%, Bitcoin's market cap share returned to over 60%, while Ethereum's price nearly reverted to its 2022 levels. Ironically, the performance of traditional stock markets completely overshadowed the crypto market, leading many practitioners and investors to choose to exit. This year has been referred to by many as the "year of maturity" for the industry, but this maturity has come at the cost of blood and tears. Those who have persevered now face the question: in 2026, will this market operate according to past logic? The answer is no. From Fidelity to BlackRock, from Coinbase to a16z, the latest research reports from the eight top crypto institutions reveal a clear signal— we are bidding farewell to the "Wild West" and entering a new era dominated by institutions.

The Four-Year Cycle is Dead, Institutional Capital Redefines Market Rules

For a long time, participants in the crypto market have been accustomed to a simple narrative: Bitcoin halves every four years, reducing supply drives price increases, leading to bull markets. This story has proven reliable over the past decade, but it faced collective skepticism in the outlook for 2026. A report from 21Shares used an extremely clear term— "broken"— to describe this once-reliable cyclical law. The reason is simple: market drivers have shifted from the supply side to the demand side. When giants like BlackRock and Fidelity begin to allocate Bitcoin to clients on a quarterly basis, the miner halving event every four years is no longer a decisive factor. Fidelity explicitly pointed out in its report that with the entry of sovereign nation reserves (such as the legislation being attempted by Brazil and Kyrgyzstan) and traditional wealth management institutions, Bitcoin is completing its transition from a "high-volatility tech asset" to a "mature safe-haven tool." Bitwise even made a bold prediction: by 2026, Bitcoin's volatility will fall below that of Nvidia's stock for the first time. This is not just a numbers game; it signifies a fundamental change in Bitcoin's asset attributes. It is no longer a speculative tool that belongs only to adventurers and geeks, but is beginning to enter the allocation lists of pension funds, insurance funds, and family offices. When the main buyers of an asset shift from retail to institutions, its price discovery mechanism, liquidity structure, and valuation logic will be restructured accordingly.

Stablecoins and AI Payments: The Rise of New Financial Infrastructure

If Bitcoin is becoming digital gold, then stablecoins are the "digital dollars" of this new world. Several institutions have independently listed stablecoins as one of the most certain opportunities for 2026. 21Shares predicts that the total market cap of stablecoins will exceed $1 trillion, while Galaxy Digital has made a shocking judgment: the on-chain transaction volume of stablecoins will officially surpass that of the U.S. ACH (Automated Clearing House) network. What does this mean? It means that stablecoins are no longer just tools for transfers between crypto players but are beginning to challenge traditional financial payment channels. Imagine when cross-border remittances can be as instant and cheap as sending a WeChat message; how much value will remain in the existence of traditional interbank clearing systems? a16z describes stablecoins as the "foundational settlement layer of the internet," and this positioning is apt. They are not meant to replace fiat currencies but to become a more efficient means of transferring fiat in the digital world. More radical changes come from the combination of AI and crypto payments. Coinbase highlighted Google's Agentic Payments Protocol (AP2) standard in its report, as well as their own developed x402 protocol. Behind these seemingly technical terms lies an exciting future scenario: AI agents will have their own crypto wallets, capable of tirelessly purchasing data, computing power, and storage services through micro-payments 24/7. a16z creatively proposed the concept of "KYA" (Know Your Agent), pointing out that among the current on-chain transaction entities, the ratio of "non-human" to "human" has reached 96:1. When AI becomes a major participant in economic activities, the traditional "Know Your Customer" (KYC) system will become completely ineffective, and crypto payments will become a necessity for AI commercial civilization.

The Explosion of Prediction Markets: The Free Market of Information Has Finally Arrived

In 2025, prediction markets experienced explosive growth, with nominal weekly trading volume reaching $3.8 billion for the first time. But this is just the beginning. Bitwise, 21Shares, and Coinbase have all simultaneously listed prediction markets as a core narrative for 2026, and this "institutional consensus" itself is telling. 21Shares predicts that the annual trading volume of prediction markets will exceed $100 billion, while Bitwise believes that decentralized prediction markets will become a "source of truth" parallel to traditional news media. This is not an exaggeration. In today's world of extreme information fragmentation and difficulty in distinguishing truth from falsehood, prediction markets provide a unique mechanism: using real money to verify the credibility of information. When tens of thousands of participants bet their own funds on the outcome of an event, the market price itself becomes the most honest opinion poll. Even more interesting is Coinbase's proposed "tax-driven theory." They pointed out that the new U.S. tax law limits the deduction of gambling losses, which may inadvertently push users toward prediction markets, as the latter may be classified as "derivatives" rather than "gambling" for tax purposes, thus having tax advantages. This regulatory arbitrage sounds technical, but it precisely illustrates a trend: as the regulatory framework improves, crypto products are moving from the gray area toward compliance, finding their unique survival space in the process.

Opportunities Hidden in Divergence

When all institutions are optimistic about a certain direction, the price in that direction often already reflects expectations. True excess returns often exist in divergences. In the outlook for 2026, the biggest divergences are concentrated in two areas: corporate digital asset treasuries (DAT) and the future of Layer 2. The "public company hoarding coins" model initiated by MicroStrategy sparked a trend in 2024-2025, but institutions have polarized views on this. Galaxy Digital and 21Shares belong to the "cleansing faction," predicting that at least five DAT companies will be forced to sell assets, be acquired, or go bankrupt. Although 21Shares predicts that the total scale of DAT will increase to $250 billion, it emphasizes that "only a few will survive." Those small DAT companies that have long traded below net asset value will face a life-and-death test in 2026. Meanwhile, Grayscale continues to maintain its "red herring" view, believing that although DAT has a loud media presence, it will not become the core driving force for market pricing. In the Layer 2 space, 21Shares made the sharpest prediction: the vast majority of Ethereum Layer 2s will not survive past 2026, becoming "zombie chains." Liquidity and developer resources have a strong Matthew effect, ultimately concentrating on the leaders (like Base and Arbitrum) and high-performance chains (like Solana). Data from Galaxy Digital further validates this judgment: they predict that the ratio of application layer revenue to network layer revenue will double by 2026, indicating that value is flowing from the infrastructure layer to super applications with real users. This is a victory for the "fat application" theory and a judgment against projects that focus solely on technology without considering users.

Survival Rules for 2026: Return to Fundamentals and Real Value

Overall, the crypto market in 2026 will present a completely different face. The simple model of "buying with closed eyes and waiting for halving" has become a thing of the past. The speed of narrative rotation in the market is accelerating; topics that used to last for weeks or even months can now only last a few days at most. The crypto community is shifting from chasing narratives to focusing on real fundamentals— user numbers, revenue, growth metrics, and most importantly, the value transfer relationship between business and tokens. The chaotic game between equity and tokens in 2025 provided the market with a profound lesson. When Pumpfun acquired Padre, leaving token holders completely in the dark, and when Circle acquired Axelar, ignoring the interests of the token community, the market's anger was justified. This gave rise to the emergence of the MetaDAO model— a fair, transparent, and unmanipulable ICO launch platform, with no venture capital private placements, introducing performance-based team unlocking and fund recovery mechanisms. This "ownership token" model allows token holders to truly have a voice and ownership of the project, with project revenue no longer flowing to equity holders but directly benefiting the token community. For individual investors, the survival rules for 2026 can be summarized in a few points. First, embrace leaders and real returns. In the brutal cleansing of Layer 2 and DAT, liquidity and capital structure are survival indicators; only protocols that can generate positive cash flow are worth holding long-term. Second, understand the upgrades in technological infrastructure. From Google's AP2 standard to the KYA concept, from stablecoins replacing ACH to the rise of AI payments, these technological changes will bring new investment opportunities. Third, be wary of false narratives. In the eyes of institutions, there are not only golden opportunities but also "red herrings." Distinguishing between long-term trends and short-term speculation will be key to success. After the painful baptism of 2025, those who have persevered now stand at a new starting point. This market is no longer a "Monopoly" game but resembles a stage for enterprises, startups, and professional investors. Your competitive advantage can be having a clear mind not clouded by delusions, being good at telling compelling stories, creating products that people truly need, having insights into trends, or trading rationally without being swayed by emotions. But whatever it is, you need to find your true advantage, rather than relying on luck and cycles. Because in 2026, the rules of the game have completely changed.