Key Highlights
- Grayscale says Bitcoin’s four-year halving cycle is weakening and expects the price could hit new highs in 2026 despite recent volatility.
- Macro factors like expected U.S. rate cuts and new crypto legislation may support Bitcoin heading into 2026.
- Privacy coins outperformed in November, while AI-linked tokens lagged, showing shifting momentum across crypto sectors.
Grayscale Research is pushing back against one of crypto’s most widely repeated ideas: that bitcoin reliably rises and falls in a four-year rhythm tied to its halving events.
In a report published on December 1, the firm argues that this pattern is weakening and that bitcoin could set new all-time highs in 2026, even though the market has spent the last two months under pressure.
Bitcoin has been sliding for the past few months, falling about 32% from its all-time high of around $126,000 and now trading near $87,521, as per data from CoinMarketCap.
According to Grayscale, this kind of pullback is still typical for a bull market, where sharp drops often occur without signaling a lasting reversal. The firm notes that long-term investors have historically been rewarded for holding through these sometimes difficult drawdowns.
The firm directly pushes back on the idea that bitcoin is destined for a cyclical crash. “Although the outlook is uncertain, we believe the four-year cycle thesis will prove to be incorrect, and that Bitcoin’s price will potentially make new highs next year,” Grayscale analysts wrote.
Macro trends that could support Bitcoin
Macro conditions could add support. Expectations for U.S. rate cuts and ongoing bipartisan work on crypto market-structure legislation may provide a more constructive environment heading into 2026. Investors will get a clearer picture when the Federal Reserve meets on December 10.
BitMine CEO Tom Lee offered a similar assessment. In a post on X and comments to CNBC, Lee said crypto prices have weakened even as underlying activity, wallet growth, on-chain transactions, and tokenization efforts continue to expand. He believes the disconnect creates room for a rebound and expects bitcoin to set a fresh all-time high as early as January.
November crypto market snapshot
The research also highlights how different corners of the market moved in November. Privacy-focused cryptocurrencies such as Monero, Zcash, and Decred outperformed, helped by renewed technical work on privacy within the Ethereum ecosystem.
Meanwhile, AI-linked crypto assets weakened, though projects like Near’s “Intents” system, designed to simplify cross-chain actions, are seeing early signs of adoption.
Another area showing momentum is machine-driven payments. Coinbase’s new x402 protocol, which enables AI agents to send stablecoin payments without account setup or manual approval, surged from under 50,000 daily transactions in mid-October to more than 2 million by late November. Grayscale sees this as an early signal that automated micro-payments may become a real use case.
Wider market outlook
At the same time, the investment landscape is broadening. After new Securities and Exchange Commission listing standards took effect in September, the first U.S. exchange-traded products (ETPs) tied to XRP and Dogecoin launched, joining more than 120 crypto ETPs now on the market.
Despite these developments, overall market performance in 2025 has been uneven. Grayscale notes that long-term fundamentals have improved, mainly due to regulatory clarity and institutional inflows, but prices haven’t fully reflected those changes. The firm believes that if rates fall and legislation advances, sentiment could improve into next year.
Still, Grayscale stresses that volatility is part of the path for bitcoin investors. The firm’s view is that the recent pullback resembles the short, sharp drawdowns typical of bull markets, not the deeper, multi-year declines seen in past cycles. If that holds true, it says, the next major move could be higher rather than lower.
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