Bitcoin 2026 Data-Driven Outlook

Author: Matt Crosby, Source: Bitcoin Magazine Pro, Translated by: Shaw Jinse Finance

Despite Bitcoin's disappointing price performance in 2025, it still faces numerous favorable macroeconomic factors heading into 2026. While the coming year remains uncertain, multiple indicators suggest that the worst of the sell-off may be over, with long-term holders' selling pressure reaching historical extremes, and on-chain data indicators pointing to a possible stabilization in early 2026.

2025 Review

While Bitcoin reached an all-time high in US dollar terms in 2025, if measured in gold (which more accurately reflects its real purchasing power), Bitcoin actually peaked approximately a year earlier in December 2024, and has since fallen by more than 50%. This discrepancy explains the psychological pain many investors experienced despite the record-breaking nominal prices. This year saw unusually active whale trading, with the cumulative number of long-term holders, known as the "Whale Shadows," reaching an all-time high, indicating an unprecedented transfer of Bitcoin from long-term holders to the market. [Figure 1: A large number of long-term holders transferred BTC in 2025.] It's worth noting that long-term holders distributed approximately 7 to 8 million Bitcoins in 2025, while the combined inflow of funds from the Digital Asset Treasury (DAT) Reserve and ETFs was only about 2 million. This means that about 75% of the Bitcoins distributed by long-term holders were absorbed by retail investors. While this may seem like a negative factor on the surface, it actually has significant positive implications. This distribution represents a shift in Bitcoin holdings, from early investors who may have bought Bitcoin for a few cents to recent long-term holders, who are less likely to engage in rapid or panic selling. Figure 2: Since the cycle peak, Bitcoin ETF holdings have decreased by less than 5%. This large-scale sell-off by long-term holders, coupled with the resilience of Bitcoin prices and the fact that the ETF, despite ample liquidity, has only sold about 4%-5% of its holdings, indicates that the fundamental demand structure remains intact. In any previous bull market, a 35% drop from the historical high would be considered a standard bull market correction! Macroeconomic Indicators: The Federal Reserve continues to lower its target range for benchmark interest rates, and the market expects further rate cuts. The two-year US Treasury yield spread is lower than market expectations, and the possibility of Federal Reserve Chairman Jerome Powell being replaced by a more radical, pro-cryptocurrency candidate marks a significant policy shift. Quantitative tightening will end on December 1, 2025, marking the fourth such policy termination in Bitcoin's history. The previous three occurred in 2010, 2012, and 2019. Each of these terminations was followed by a significant rise in Bitcoin prices; however, the 2019 termination was followed by the COVID-19 pandemic, after which Bitcoin experienced a substantial price increase. Figure 3: A reduction in the Fed's target range for the benchmark interest rate may reignite demand in risk-averse markets. Global Liquidity Signals (based on year-on-year growth and back 100 days) have historically been near-perfect predictors of Bitcoin prices. After reaching its peak (almost perfectly coinciding with the peak of the Bitcoin market cycle in October 2025), this indicator is now expanding again, suggesting that the Bitcoin price may have bottomed out in early 2026. Figure 4: The correlation between the year-on-year global M2 money supply and the Bitcoin market suggests that the Bitcoin market will begin to recover in early 2026. 2026 Probability-Weighted Scenario 2026 will primarily present three development trends:

Bearish Scenario (25% probability): Bitcoin falls further to the 15.44 Fibonacci retracement level, resulting in a valuation of approximately $66,000. If gold also corrects, the price of Bitcoin could fall further to $60,000 or even lower. This scenario assumes high market risk aversion, a potential economic recession, or a major black swan event.

Basic Scenario (50% probability): The price of Bitcoin falls further in the short term to between $70,000 and $75,000, before stabilizing and recovering in late 2025 or early 2026. A rebound from this bottom could see Bitcoin approach $100,000 and the 365-day moving average, potentially reaching the 2021 bull market peak in gold terms. This scenario reflects a lackluster bear market, similar to the previous somewhat weak bull market, with a slight upward trend expected in 2026, but not significantly exceeding expectations. Bullish Scenario (25% probability): Bitcoin accelerates towards the target price of 52.55 ounces of gold per coin, potentially exceeding $200,000 in USD terms (and possibly higher if gold prices rise further). This scenario requires a significant injection of liquidity and a shift of funds from other risk assets to Bitcoin. Figure 5: Predicting BTC price movement in 2026 using three probability-weighted scenarios. (Image: https://img.jinse.cn/7422822_watermarknone.png) Conclusion: Despite Bitcoin's record-breaking price, its performance in 2025 was less than satisfactory and should be viewed within a longer-term trend context. The broad allocation of 7 to 8 million Bitcoins from early holders to more recently active investors, coupled with a historic sell-off by whales and long-term holders, marks a structural maturation of the Bitcoin market. The endorsement from institutional investors, DAT companies, and ETFs suggests that Bitcoin is transitioning from a period of extreme volatility to a more normalized market pricing pattern. While 2026 remains fraught with uncertainty, existing data suggests that Bitcoin's worst price action may be over. Positive macroeconomic factors, including potential interest rate cuts, the end of quantitative tightening, and currency devaluation pressures, have created structurally favorable conditions for Bitcoin. The historic sell-off by long-term holders, combined with retail absorption of these allocations and confidence in ETFs (despite ample liquidity, the sell-off was minimal), indicates that the market has already priced in considerable downside risk.