Digital Assets Show Complex Signals as 2026 Begins

According to BlockBeats, VanEck's Head of Digital Assets, Matthew Sigel, has shared insights on the outlook for digital assets as 2026 begins. Sigel notes that Bitcoin has experienced a significant decline of approximately 80% in the previous cycle, but its actual volatility has since reduced by nearly half. This suggests that the current downturn might be limited to around 40%, with the market having already absorbed about 35% of the decline. Sigel highlights the historical four-year cycle of Bitcoin, which often peaks during the post-U.S. election window, indicating that the pattern remains valid following the peak in early October 2025. This suggests that 2026 is likely to be a year of consolidation rather than dramatic surges or crashes. Global liquidity in 2026 presents a mixed picture, with expectations of interest rate cuts providing support. However, U.S. liquidity is slightly tightening due to the clash between AI-driven capital expenditure and a fragile financing market, leading to wider credit spreads. The leverage within the crypto ecosystem has been reset following multiple shakeouts, and while on-chain activity remains weak, there are signs of improvement. In this context, Sigel recommends establishing a disciplined Bitcoin allocation of 1% to 3% through a dollar-cost averaging strategy. He advises increasing holdings during leverage liquidations and reducing them when market speculation becomes overheated.