BloFin 2026 outlook: Bitcoin cycle questioned, Ethereum’s asset case weakens
BloFin Research’s 2026 market outlook says evolving market structure is reshaping crypto’s core narratives. The report highlights that Bitcoin in 2025 delivered the first-ever negative annual return in a post‑halving year while still reaching a new all‑time high in Q4, a paradox that has reignited debate over the four‑year cycle.
BloFin argues the arrival of spot Bitcoin ETFs and steady institutional demand has altered Bitcoin’s demand profile, introducing a more persistent bid versus retail flows. The firm cautions that declaring the four‑year cycle dead is premature: investor expectations and long‑term holder behavior (notably distributions in post‑halving years 2017, 2021 and 2025) can remain self‑reinforcing, but 2026 is more likely to be volatile and range‑bound rather than a textbook deep bear market.
On Ethereum, BloFin says the network is stronger as a settlement and Layer‑2 ecosystem but the ETH asset narrative has weakened. Lower transaction fees and migration to rollups have reduced fee burning, pushing ETH supply back toward inflation. The report frames two competing asset narratives—“digital oil” and a “yield‑bearing institutional treasury”—and notes staking yields have fallen with fees and are now lower than the U.S.
dollar interest rate, undercutting the yield thesis. BloFin describes Layer‑1 smart contract platforms as a highly competitive market where blockspace pricing trends toward marginal cost.
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