Will the crypto industry be better in 2026?

In the final months of 2025, a bear market atmosphere began to spread. Bitcoin plummeted from its high of $120,000, ETF inflows ceased, various cryptocurrencies diverged, and Memecoin, which had once ignited market sentiment, began to be ignored. Compared to the end of 2021, there were no sudden regulatory crackdowns this time, and apart from the 10/11 crash, there didn't seem to be a serious liquidity crisis, yet something still felt off. If the crypto world in 2025 was a recalibration of true and false value, will crypto be better in 2026? This article attempts to find answers, and perhaps we need to accept the fact that the crypto industry may be entering an era that is no longer driven by unilateral growth or the "casino narrative".

Macroeconomic trends are improving, and Bitcoin remains in the spotlight

Over the past year, Bitcoin's price performance and market positioning have undergone significant changes.

After reaching an all-time high of $120,000, the price began to decline, with increased volatility and a gradual cooling of market sentiment.

After reaching an all-time high of $120,000, the price began to fall back, with increased volatility and a gradual cooling of market sentiment.

Unlike past rallies driven by retail investors, this round of gains is primarily driven by institutional funds behind ETFs. Looking at holding costs, CryptoQuant analyst Axel Adler Jr. pointed out last month that the average holding cost of US ETFs is $79,000, which many consider one of the price support levels. Therefore, Bitcoin's current price movement increasingly resembles that of a highly volatile institutional asset. On the one hand, it has an inflation-hedging role similar to gold; on the other hand, like tech stocks, it is influenced by macro sentiment and risk appetite, exhibiting beta properties. From a broader perspective, 2025 is expected to be a year of improved sentiment for global risk assets. AI is the biggest theme, US stocks continue to reach new highs, and the Federal Reserve announced three interest rate cuts in December, leading the market to re-enter a phase of improved liquidity expectations. The FOMC's year-end economic projections show that the US GDP growth forecast for 2026 has also been revised upward from 1.8% to 2.2%–2.5%. There's a general expectation that monetary easing will continue next year, which could be beneficial for assets like Bitcoin. However, the market isn't without risk. If the economy suddenly weakens in 2026, or inflation unexpectedly rebounds, risky assets could still face significant corrections.

Regulatory Turning Point: Policy Trends in the US and Hong Kong

Another important change in 2025 is the formalization of regulatory frameworks.

In the United States, two key bills have been enacted. The first is the GENIUS Act, which clarifies the definition of stablecoins, reserve requirements, and issuance qualification thresholds, providing a compliance path for mainstream stablecoin issuers. This act was signed into law by the President in July 2025 and will take effect 18 months after signing or 120 days after the regulatory agency issues its final rules. The second is the CLARITY Act, which systematically delineates the boundaries between "security tokens" (regulated by the SEC) and "commodity tokens" (regulated by the CFTC) and proposes tiered regulation. This bill will be submitted to the Senate for consideration in January, and may then require the President's signature; the effective date is yet to be determined. Meanwhile, the SEC is also accelerating the approval of more crypto ETFs, opening channels for institutional products. In Hong Kong, the regulatory pace is also accelerating. In 2025, the Hong Kong Monetary Authority (HKMA) will introduce a stablecoin issuer regulatory regime, explicitly requiring all Hong Kong-based stablecoin issuers to be licensed. This means that in the future, issuing USD-denominated or RMB-denominated stablecoins in Hong Kong will require meeting certain capital and compliance requirements. Furthermore, HashKey has been listed on the Hong Kong Stock Exchange, becoming the first compliant platform with crypto trading as its core business to IPO in Hong Kong, marking a milestone. Overall, the regulatory trends in both the US and Hong Kong are to both curb illegal speculation and open up legitimate business channels, promoting the industry's evolution towards institutionalization and compliance. Stablecoins, prediction markets, and on-chain US stocks are the three main themes. Over the past few years, the most stable growth curve in the crypto industry has actually been stablecoins. By 2025, the global issuance of stablecoins exceeded $300 billion, with USDT and USDC accounting for over 80% of the total. Stablecoins are becoming part of the global payment network, and their use cases have permeated daily merchant transactions and cross-border settlements. In 2026, stablecoins are likely to be even closer to the real world than ever before. Traditional giants like Visa, Stripe, and PayPal are already using stablecoins for settlements. For example, Stripe already supports merchants subscribing with stablecoins, and there are already real-world services implemented with them. Image source: a16z Furthermore, with clearer regulations, government bond-backed stablecoins (backed by high-quality assets) and regional stablecoins are expected to emerge, such as the digital currency bridge projects promoted by Japan and the European Union. Another area worth noting is the prediction market. Originally, most people considered prediction markets to be too niche or non-compliant. But now, they're gradually evolving into a combination of "on-chain betting + pricing tools" around themes like US elections, sports events, and economic data. For example, Kalshi, which obtained a formal futures license from the US CFTC, can legally offer prediction trading related to macroeconomic data, and its valuation has climbed to $11 billion. Polymarket, leveraging topics like US elections and entertainment events, has also become a place for many users to place bets and observe public opinion. By 2026, prediction markets may move beyond pure speculation; users may not just bet on wins or losses, but rather vote with their money, expressing their judgment on the probability of a certain outcome. This collective wisdom-based pricing method could potentially be referenced and used by media, research institutions, and even trading strategies. Furthermore, AI will open up new possibilities for prediction markets, allowing them to move beyond human betting and automatically analyze data, place orders, and even generate new order books. This will make prediction markets faster and smarter, gradually transforming them into tools for assessing risk and trends, rather than just places to gamble. Finally, the development of on-chain US stocks cannot be ignored. Simply put, the crypto industry is now not only trading crypto assets but also bringing real-world assets onto the blockchain. For example, Securitize plans to launch the first fully compliant on-chain stock trading platform in 2026, where tokens purchased on-chain correspond to real company stock, granting users voting rights and dividends. Emerging Narratives Emerge: New Directions Possibly Taking Off in 2026

Emerging Narratives Emerge: New Directions Possibly Taking Off in 2026

Meanwhile, a number of seemingly peripheral directions are also worth paying attention to. The following content is referenced from a16z's latest report, "17 Exciting Directions for the Crypto Industry in 2026"

https://a16zcrypto.com/posts/article/big-ideas-things-excited-about-crypto-2026/

Image source: a16z

1. The identity issue of AI agents

With the rise of AI As intelligent agents begin to participate in transactions, browse, place orders, and even interact with smart contracts, a crucial question arises: how do these non-human identities prove "who they are"? The "Know Your Agent" (KYA) concept proposed by a16z aims to address this issue. On-chain, any agent initiating a transaction must have clear permissions and ownership, requiring cryptographically signed credentials for the transaction. In 2026, this could become a prerequisite for the large-scale deployment of on-chain AI. 2. x402 Protocols and Micropayments a16z predicts that as AI Agents extensively process transaction data, utilize computing power, and access interfaces, we will enter an era of "automatic settlement + programmatic payment." Manual payments will no longer be necessary; AI Agents can identify needs and automatically execute payments. This is precisely the real-world problem that protocols like x402 are solving. Their presence will become increasingly prominent by 2026. 3. Privacy Chains Will Receive More Attention a16z points out a key trend: compared to the convergence of performance competition, privacy will become the core moat of future public chains. In the past, people worried that privacy chains would be detrimental to regulation and lack transparency. But now the problem is reversed; business data is too sensitive, and without privacy protection, compliant institutions simply dare not use the chain. Precisely because of this, chains that come with privacy protection by default are becoming attractive. Once users use these chains, their data will not be easily leaked, and the migration cost is higher, naturally forming new user stickiness—this is actually a network effect. 4. Staked Media In the era of AI-generated content, judging the reliability of a statement cannot solely rely on who said it; it also requires considering the cost of saying it. Therefore, a16z proposes a new media model where content creators not only speak but also "stake" their positions through methods such as staking, prediction markets, and NFT tokens. For example, if you express a bullish view on ETH, you simultaneously lock up your own ETH holdings as collateral; if you make an election prediction, you also bet on the blockchain. These public bindings of interest will ensure that content is not just empty talk. If this approach proves successful, it could become the new norm for on-chain media in the future. Of course, the a16z report covers far more than just these few directions. This article focuses on four trends that we believe are more representative, but other directions are equally noteworthy, such as: stablecoin deposit and withdrawal upgrades, RWA crypto-native adoption, stablecoin-driven upgrades to bank ledger systems, diversified wealth management, the rise of AI research assistants, AI agent real-time content revenue sharing mechanisms, decentralized quantum-resistant communication, "privacy as a service" becoming infrastructure, the DeFi security paradigm shift, intelligent prediction markets, verifiable cloud computing, emphasis on product-market fit (PMF), and crypto legislation unlocking more potential for blockchain. Interested readers can refer to the original a16z report for further in-depth understanding. The crypto industry is breaking out of its self-contained cycle. Early growth in the crypto industry was largely built on a self-contained system, with token issuance, rebates, and airdrops all attempting to attract more people to stay. However, this closed loop is gradually being broken by reality. From Polymarket to USDT, and then to the cross-border applications of USDC, we are seeing more and more people who are not Web3 users using blockchain tools. Small vendors on the streets of Lagos may not understand wallet structures, but they know that using USDT is much faster than bank transfers. In countries with high inflation, depositors are flocking to USDC, simply for hedging rather than speculation. One of the most obvious changes is in payment scenarios in developing countries, such as the Philippine exchange Coins.ph partnering with Circle to open a low-cost USDC remittance channel. This trend indicates that crypto technology is being embedded in real-world scenarios such as cross-border payments and remittance channels. The true future of crypto may lie in how to use technology to solve real-world problems, enabling more ordinary people to unconsciously adopt blockchain. The recent discussion about whether spending years in the crypto industry is worthwhile is essentially a collective review of the industry. Castle Island Ventures Partner Nic Carter (@nic_carter) continued his reflection on whether eight years of crypto had been wasted, frankly stating that only Bitcoin, stablecoins, DEXs, and prediction markets have truly achieved significant product-market fit (PMF). He chooses to maintain pragmatic idealism, accepting that bubbles and frenzy are part of the path, not the whole. Dragonfly partner Haseeb (@hosseeb) put it more bluntly, pointing out that the problem isn't the existence of casinos, but rather that focusing solely on their glamour will cause one to miss the true transformation of the industry. He believes cryptocurrency is a better vehicle for finance and will forever change the nature of money, hoping the industry will remain patient: "The Industrial Revolution took 50 years to change productivity, and we've only had 15." XHunt & Biteye founder @DeFiTeddy2020's summary was also extremely realistic. In his view, the crypto industry can quickly expose its financial nature, facing projects going to zero, prices decoupling from fundamentals, and even insider trading, manipulation, and exploitation. It's not a breeding ground for idealism, but a market that constantly educates participants with real money, truly honing their minds. Regarding the future development direction of the industry, KOL "Crypto Goddess" @xincctnnq offers a long-term perspective: crypto truly attempts to solve long-term problems such as the monetary system, contract execution, digital property rights, capital market efficiency, and financial inclusion. Even if the results are distant and the process is rough, it's worth continuing to try. Furthermore, trader & analyst @CryptoPainter provides a more market-structure-oriented explanation: the crypto market repeats its consistent operating mechanism: "value investing" - "conviction investing" - "emotional speculation" - "utter disappointment," and then it starts again. This cycle has occurred in 2018 and 2022, and it's destined to repeat itself. Gamblers and casinos are not abnormal; they are part of the market's self-regulation process, absorbing bubbles. The stance of DougieDeLuca (@DougieDeLuca), a member of Figment Capital, is more like a summary of a phase. He bluntly states that "Crypto is dead" doesn't mean the price has gone to zero or the blockchain has stopped operating, but rather that "Crypto as a closed industry is dying out." True success should be integrating Crypto technology into the daily lives of ordinary people. From a more institutional perspective, KOL & researcher @lanhubiji mentions that as old users begin to leave, newcomers with traditional financial backgrounds are entering the market. In their view, encryption is a long-term trend that has already entered a path of standardization, interoperability, and scaling. Three years from now, a completely new era of on-chain finance, an on-chain Wall Street era, will gradually emerge. Meanwhile, the assessment of LD Capital founder Jackyi Yi (@Jackyi_ld) is closer to the current cyclical level. He points out that the recent slump in encryption is more of a temporary resonance between liquidity and macroeconomic events. Currently, the negative factors are gradually being digested, and with the dual benefits of interest rate cut expectations and encryption policies, he remains optimistic about the subsequent market trend. At a broader level of regulation and industry structure, Hashkey Group Chairman Xiao Feng's assessment is particularly systematic. He outlines three major future trends: First, the global trend in crypto regulation is shifting from "voluntary acceptance" to "mandatory regulation," with governments gradually eliminating offshore gray areas and crypto trading becoming licensed. For example, in Hong Kong, all unlicensed trading was required to exit the market starting in June 2023. Second, crypto is no longer just about native assets like BTC and ETH; more traditional financial assets are migrating to the blockchain through tokenization, forming a new type of regulated and compliant securitization market. Third, moving from "off-chain" to "on-chain," he predicts that the second half of 2026 may be the key juncture for the initial formation of a "on-chain Wall Street." Conclusion Will crypto be better in 2026? If the expectation is for "crypto prices to skyrocket," the answer might be uncertain. However, if the question is whether the industry is moving towards a more realistic and useful direction, the answer is likely yes. From crypto ETFs to stablecoin payments, from on-chain government bonds to prediction markets, from on-chain agents to decentralized AI, all of these point to one thing: The crypto industry may be beginning to take root in the real world, and may increasingly resemble a twin financial system running parallel to the real-world financial system, resonating with the stock market, macro liquidity, policy expectations, and even the AI ​​cycle.