Bitwise Reveals 3 Critical Catalysts That Could Launch Crypto to Record Highs by 2026

Crypto's next bull run isn't a matter of 'if'—it's a matter of 'when.' And according to Bitwise, the 'when' hinges on three specific market conditions aligning. Forget vague predictions; this is a checklist for the next breakout.

The Regulatory Green Light

First up: regulatory clarity. The market needs clear rules of the road, not the current patchwork of enforcement actions and political theater. When major jurisdictions finally establish coherent frameworks—think actual laws, not just speeches—institutional capital will stop dipping its toes and start diving in headfirst. It's the difference between tentative pilot programs and trillion-dollar portfolio allocations.

Infrastructure That Doesn't Break

Second condition: bulletproof infrastructure. The next wave of users won't tolerate clunky wallets, slow bridges, or catastrophic hacks. Scaling solutions need to move from promising testnets to seamless mainnet reality. Think transaction speeds and costs that rival traditional finance, not excuses about network congestion. The tech must become boringly reliable before adoption becomes explosively mainstream.

A Killer App Beyond Speculation

The final piece? A genuine, must-have use case. We've seen DeFi summer and NFT mania, but the market is starving for an application that solves a real problem for millions—not just a new way to gamble. It could be tokenized real-world assets, decentralized social media that doesn't sell your data, or something nobody's predicting yet. This is the narrative that pulls in the next 100 million users. (And no, another meme coin pump doesn't count.)

Get these three stars to align—clear rules, robust rails, and real utility—and the path to new all-time highs opens up. Miss one, and we're stuck in sideways chatter. It's a simple formula, really, which is probably why the traditional finance crowd will overcomplicate it right up until the moment they're forced to FOMO in.

TLDR

• Bitwise reported that crypto markets began 2026 with strong gains across major assets.
• Bitcoin rose by 7% this year and crossed the $91,000 mark by January 6.
• Ether also gained 7% in the same period and reached over $3,100.
• Bitwise stated that the absence of large-scale liquidations helped improve market sentiment.
• The October 2025 liquidation event wiped out $19 billion in crypto futures in a single day.

The crypto market started 2026 with strength as key digital assets posted early gains, but risks still remain, Bitwise said, and the firm outlined three essential conditions that must hold for this rally to lead to new highs this year.

Bitcoin Gains as Selling Pressures Ease

Bitcoin ROSE 7% year-to-date, reaching $91,409.17, supported by lower market volatility and reduced liquidation fears, according to Bitwise.

Bitwise CIO Matt Hougan stated, “The absence of another major liquidation event is encouraging and could mean we’ve cleared that hurdle.”

On October 10, 2025, a $19 billion crypto futures liquidation rocked the market and sparked fears of more forced selling.

Since then, investor sentiment has improved, and large market players have not shown signs of distress entering 2026.

Bitwise suggested that any necessary unwinding likely occurred before year-end, easing concerns around systemic risk in the NEAR term.

Ether Moves Higher While Policy Outlook Remains Key

Ether climbed around 7% to $3,166.74 since the beginning of the year, reflecting renewed Optimism across crypto.

However, Hougan emphasized the importance of progress in U.S. crypto legislation moving through Congress in early 2026.

“The outlook depends on the success of the proposed crypto market structure bill,” Hougan noted in the Bitwise blog post.

The Senate Banking Committee may mark up the bill in mid-January, but the date still awaits confirmation.

Policy discussions remain active around decentralized finance, stablecoin incentives, and broader regulatory clarity in Washington.

Bitwise said the bill’s passage WOULD help protect current regulatory trends from reversal by future administrations.

DOGE Leads Risk-On Rally as Market Eyes Equities

DOGE surged roughly 29% in early 2026, suggesting growing risk appetite is spreading beyond large-cap crypto assets.

Bitwise said speculative token gains reflect broader investor confidence, but one condition still hinges on external markets.

Hougan noted that crypto markets could suffer if equities drop sharply, even without strong direct correlation.

“A 20% drop in the S&P 500 would likely weigh on all risk assets,” he said.

Though recession odds appear low, a stable equity backdrop remains vital to support digital assets’ momentum.

Bitwise also cited increasing stablecoin adoption, institutional activity, and improved regulation from early 2025 as current drivers.

The firm concluded that crypto’s early-year strength may hold if these three conditions continue through 2026.