Bitcoin may very well be heading into a protracted downturn, in accordance with Cantor Fitzgerald, however that’s more likely to be a prelude to the crypto business coming into a extra secure, institutionally pushed section.
Markets are most likely within the early section of a crypto winter, echoing bitcoin’s historic four-year cycle, in accordance with a year-end report by analyst Brett Knoblauch. Bitcoin is roughly 85 days previous its peak, and Knoblauch suggests costs might stay underneath strain for months, presumably even testing Technique’s (MSTR) common breakeven worth close to $75,000.
Not like previous downturns, nonetheless, this one is probably not outlined by mass liquidations or structural failures. Institutional individuals, not retail merchants, are actually shaping the contours of the market, in accordance with Knoblauch, who recognized a widening hole between token worth efficiency and what’s truly occurring underneath the hood, particularly in decentralized finance (DeFi), tokenized belongings and crypto infrastructure.
Take real-world asset (RWA) tokenization. In keeping with the report, the worth of tokenized RWAs onchain — belongings like credit score merchandise, U.S. Treasuries and equities — has tripled throughout the 12 months to $18.5 billion. Cantor mentioned the quantity might surpass $50 billion in 2026, with the tempo accelerating as extra monetary establishments experiment with onchain settlement.
The shift can be enjoying out in how crypto is traded. Decentralized exchanges (DEXs), which function with out intermediaries, are gaining market share from centralized venues. Whereas buying and selling volumes could fall in 2026 alongside bitcoin’s worth, Cantor mentioned it expects DEXs, particularly these buying and selling perpetual futures, to continue to grow as infrastructure and consumer expertise enhance.
Regulatory readability is a key piece on this evolving panorama. The latest passage of the Digital Asset Market Readability Act, or CLARITY, within the U.S. marks a turning level, the report says. The regulation defines when a digital asset is handled as a safety versus a commodity and assigns main oversight of spot crypto markets to the Commodity Futures Buying and selling Fee (CFTC) as soon as decentralization thresholds are met.
That authorized framework might cut back headline danger and open the door for banks and asset managers to interact extra immediately with crypto markets. It additionally strengthens the legitimacy of decentralized protocols by providing compliance pathways, which have traditionally been a significant barrier.
Different traits Cantor highlights embody the rise of onchain prediction markets, particularly in sports activities betting, the place volumes have ballooned to over $5.9 billion, greater than 50% of DraftKings’ deal with within the third quarter. Companies like Robinhood (HOOD), Coinbase (COIN) and Gemini (GEMI) have entered the business, introducing fairer, order book-driven alternate options to conventional sportsbooks.
Nonetheless, dangers stay. Bitcoin’s worth is simply about 17% above the typical value foundation of bitcoin treasury firm Technique. A break under that stage might spook the market, even when Cantor believes the agency is unlikely to promote. In the meantime, digital asset trusts (DATs) have slowed accumulation as token costs and belief premiums compress.
The approaching 12 months could not provide crypto’s subsequent large breakout. However the groundwork for extra sturdy infrastructure and deeper institutional adoption seems to be solidifying whilst costs cool.
