Original author: Alexander S. Blume

Original translation by: AididiaoJP, Foresight News

Late last year, I predicted that 2025 would be a "transformative year for digital assets," given the significant progress made in mainstream adoption across both retail and institutional markets. This prediction has been validated in several ways: increased institutional allocation, the tokenization of more real-world assets, and the ongoing development of crypto-friendly regulatory and market infrastructure.

We have also witnessed the rapid rise of digital asset treasury companies, but their path has not been smooth. Since then, as Bitcoin and Ethereum have become more deeply integrated into the traditional financial system and gained wider adoption, their prices have risen by approximately 15%.

Digital assets have undeniably entered the mainstream. Looking ahead to 2026, we will see the market continue to mature and evolve, with exploratory attempts giving way to more sustainable growth. Based on recent data and emerging trends, here are my five predictions for the cryptocurrency space in the coming year.

1. DATs 2.0: Bitcoin financial services will gain legitimacy.

Digital asset treasury companies have experienced rapid expansion this year, but this has also been accompanied by growing pains. From flavored beverages to sunscreen brands, various companies are repackaging themselves as buyers and holders of cryptocurrencies, which has brought problems to this model, including investor skepticism, regulatory resistance, mismanagement, and low valuations.

Amidst the surge of numerous companies, some DATs have also begun holding assets we might call "altcoins," but in reality, most of these projects lack historical performance or investment value and are merely speculative tools. However, in the coming year, many problems in the DAT market and its operational strategies will be resolved, and those genuine entities operating based on Bitcoin standards will find their place in the open market.

Many DATs, even the largest ones, will see their share prices begin to converge more closely with the value of their underlying assets. Management will face pressure to create value for shareholders more effectively. It's well known that a company that simply holds large amounts of Bitcoin without doing anything (while maintaining large expenses such as private jets and high management fees) is not good for shareholders.

2. Stablecoins will be ubiquitous.

2026 will be the year of widespread adoption of stablecoins. USDC and USDT are expected to go beyond trading and settlement, penetrating more deeply into traditional financial transactions and products. Stablecoins may appear not only on cryptocurrency exchanges but also in payment processors, corporate treasury management systems, and even cross-border settlement systems. For businesses, the appeal lies in their ability to achieve instant settlements without relying on slow or costly traditional banking channels.

However, similar to the DATs sector, the stablecoin market may also experience oversaturation: too many speculative stablecoin projects are launching, too many consumer-facing payment platforms and wallets are emerging, and too many blockchains are claiming to "support" stablecoins. By the end of this year, we expect many highly speculative projects to be eliminated or acquired by the market, and the market will consolidate under the more well-known stablecoin issuers, retailers, payment channels, and exchanges/wallets.

3. We will bid farewell to the "four-year cycle" theory.

I now formally predict that the "four-year cycle" theory of Bitcoin will officially end in 2026. The market is now broader and more institutionally involved, no longer operating in a vacuum. Instead, a new market structure and sustained buying power will drive Bitcoin towards a sustained, gradual growth trajectory.

This means that overall volatility will decrease, and its function as a store of value will become more stable, which should attract more traditional investors and market participants worldwide. Bitcoin will evolve from a trading instrument into a new asset class, accompanied by more stable cash flows, longer holding periods, and fewer so-called "cycles" overall.

4. US investors will be granted access to offshore liquidity markets.

As digital assets become more mainstream, coupled with favorable government policies, changes in regulations and market structures will allow US investors to access overseas cryptocurrency liquidity. This may not be a sudden shift, but over time we will see more approved affiliates, more sophisticated custody solutions, and offshore platforms that can comply with US standards.

Certain stablecoin projects may also accelerate this trend. Dollar-backed stablecoins have already been able to flow across borders in ways that are impossible through traditional banking channels. As major issuers move into regulated offshore markets, they are poised to become bridges connecting US capital with global liquidity pools. In short, stablecoins may ultimately be precisely what regulators have been struggling to address: connecting US investors with international digital asset markets in a clear and traceable manner.

This is crucial because offshore liquidity plays a key role in price discovery in the digital asset market. The next stage of market maturity will be the standardization of cross-border market operations.

5. Products will tend to become more complex and sophisticated.

In the new year, the complexity of Bitcoin-related debt and equity products, as well as trading products focused on Bitcoin-denominated returns, will reach new heights. Investors, including those who previously shunned digital assets, will embrace this newer and more sophisticated portfolio.

We are likely to see structured products using Bitcoin as collateral, as well as investment strategies designed to generate real returns from Bitcoin exposure (rather than simply betting on price movements). ETFs are also beginning to move beyond simple price tracking, offering sources of return through staking or options strategies, although fully diversified total return products remain limited. Derivatives will become more complex and better integrated with standard risk frameworks. By 2026, Bitcoin's function will likely shift from being primarily a speculative tool to becoming a core component of financial infrastructure.