Simply put
- Matthew Hogan from Bitwise remarked that for Bitcoin and other cryptocurrencies to have a chance of climbing back in 2026, the crypto market needs to be stable, free from major liquidation events.
- Analysts have pointed out that the stability of the stock market is crucial; a significant drop could negatively impact cryptocurrency prices.
- Advancements on the Transparency Act may offer regulatory support, with an uptick expected in the Senate around mid-January.
For Bitcoin to regain its footing and approach the heights it reached last October, it essentially requires a stable market devoid of significant downturns.
According to Hogan, there are a couple of factors that could potentially drive the leading cryptocurrency and the wider market upwards.
These factors include a stable stock market alongside the advancement of legislation aimed at transparency.
Stable virtual currency market and stock market
The first essential element is to maintain a stable cryptocurrency market, avoiding repeats of events like the one on October 10.
This historic occurrence was a contributing factor to the struggles cryptocurrencies faced in the last quarter of 2025, as investors were anxious about large companies needing to shut down, Hogan noted.
“Concerns about potential large-scale sales have loomed over the market,” he explained, adding that these worries seem to be fading and the first catalyst is now looking positive.
The second factor is the need for stock market stability.
“A severe drop, let’s say a 20% fall in the S&P 500 index, would dim the appeal of all risk assets, including cryptocurrencies, in a short timeframe,” Hogan stated.
“The stock market should ideally remain steady rather than fluctuating wildly,” mentioned Ryan Yoon, a senior analyst at Tiger Research in Seoul. “Once we achieve a certain level of stability, investors will likely gravitate toward the crypto market for potential gains.”
The final trigger could be legislative action. The potential passage of the Cryptocurrency Market Structure Act, informally known as the Clarity Act, would provide significant support.
David Sachs, a crypto advisor at the White House, indicated that the bill is “closer than ever” to being passed, with the Senate aiming for a mid-January increase.
“If the bill clears this stage, it would represent a decisive step toward final approval,” Hogan mentioned. “Without legislation, the current favorable regulatory environment could shift under new leadership, so passing this Act would enshrine core principles and lay a strong foundation for future advances.”
Looking to the future
Tim Sun, a senior researcher at Hashkey Group, pointed out that short-term trends often emerge from specific happenings, like the upcoming midterm elections and fiscal policies, and they may experience volatility but also resilience.
He also highlighted that medium-term developments will likely be driven by institutional interest, particularly through spot ETFs that attract long-term investment, enhancing market efficiency.
Yoon observed that interest is growing for the OG project, which focuses on practical applications, suggesting that emerging use cases may be necessary to capture broader attention.
Additionally, Sun mentioned the importance of a well-developed regulatory framework, which can lead to clearer institutional engagement, fortifying Bitcoin’s role as a hedge against inflation and a strategically allocated asset.
As of now, Bitcoin is trading at $90,866, reflecting a 2.2% drop over the last 24 hours, recovering from a spike above $94,000 last week, according to CoinGecko data.
