Author: Ignas
Translation: Glendon, Techub News
A year ago, I wrote "The Truth and Lies of the Cryptocurrency Market in 2025." At that time, everyone was eager to predict and share higher target prices for Bitcoin, while I sought to build a distinct analytical framework to explore the potential biases in public predictions and take a different stance accordingly. The goal was simple: to unearth ideas that already exist but are overlooked, unpopular, or misunderstood.
Before sharing the 2026 edition, let’s first clearly review the key points of the 2025 cryptocurrency market, analyzing what we got right, what we got wrong, and what lessons we should learn from it. After all, if we do not examine our own thinking processes, investing becomes mere guessing, devoid of any method.
Quick Key Points Review
"Bitcoin will peak in the fourth quarter": At that time, most people held this view, but it seemed too easy, making it hard to believe. It turned out they were right, and I was wrong (and paid the price for it). Unless Bitcoin starts to rise significantly from here and breaks the four-year cycle pattern, I will accept this mistake gracefully.
"Retail investors prefer Meme coins": The reality is that retail investors have no particular preference for cryptocurrencies. They are more inclined to buy gold, silver, AI stocks, and anything that is not cryptocurrency. Moreover, the super cycle of Meme coins or AI proxies has not materialized.
"AI x Crypto remains strong": The situation is mixed. On one hand, related projects continue to launch, and the x402 standard combining cryptocurrency with AI is growing, with fundraising activities still ongoing; on the other hand, tokens struggle to maintain upward momentum.
"NFTs are dead": This judgment is correct.
These points are easy to summarize, but the real insights lie in the following five larger themes.
Spot ETFs are a floor, not a ceiling
From March 2024 to November 2025, long-term Bitcoin holders (OGs) sold approximately 1.4 million Bitcoins, worth up to $12.117 billion (data source: WuBlockchain). Imagine the predicament the cryptocurrency market would be in without the existence of ETFs. Although Bitcoin's price declined during this period, the inflow of funds into Bitcoin ETFs remained positive, reaching $26.9 billion.
The approximately $95 billion gap is the reason Bitcoin has underperformed compared to almost all other macro assets. However, this is not a problem inherent to Bitcoin itself. In fact, one does not need to delve deeply into specific data like unemployment rates or manufacturing to understand this phenomenon. It is merely the "great rotation" spoken of by whales and "four-year cycle believers."
Perhaps more crucially, Bitcoin's performance is starkly different from that of traditional risk assets like the Nasdaq. Currently, the correlation between the two is -0.42, the lowest level since 2022.
While we all expected the correlation to break upwards, in the long run, this is good news for Bitcoin, as institutional investors are actively seeking non-correlated assets in traditional risk portfolios.
Overall, ETFs have successfully absorbed supply shocks that could have caused market turmoil in the past. More encouragingly, there are signs that these supply shocks are gradually dissipating: long-term Bitcoin holders have stopped selling for the first time since July. Based on this, I boldly predict that Bitcoin's price could reach $174,000 in 2026, which would be equivalent to 10% of gold's market value (at $5,000 per ounce).
Airdrops are far from dead
The crypto community seems to periodically declare that "airdrops are dead." At the beginning of 2025, they made similar statements. However, if airdrops were truly dead, how would I have received a $46,000 Lighter airdrop?
In 2025 alone, we witnessed nearly $4.5 billion in large airdrop distributions:
Story Protocol (IP): approximately $1.4 billion
Berachain (BERA): approximately $1.17 billion
Jupiter (JUP): approximately $791 million during "Jupuary"
Animecoin (ANIME): approximately $711 million
Linea (LINEA): approximately $437 million
What has truly changed in the market is that people are experiencing fatigue with points, improvements in witch detection technology, and a decline in project valuations. Moreover, to maximize profits, one must sell all airdrops. The "obvious truth" of 2025 is that many projects perform better before TGE, and this has proven to be correct.
Looking ahead, 2026 will be a year of airdrop prevalence, as many major players are actively preparing for TGE: Polymarket, Kalshi (possibly?), Metamask, MetaETH, Tempo, Base (?), and several decentralized exchanges for perpetual contracts.
Therefore, this year is not the time to stop participating in airdrops, but one can no longer bet blindly. Airdrop mining requires high focus to make significant bets.
Fee switches have not driven token prices up, but rather provided support
I made a significant prediction: fee switches would not automatically drive token prices up. It turns out this prediction was correct.
In fact, most protocols struggle to generate sufficiently high revenue to significantly boost token prices, as the revenue-to-market cap ratio in cryptocurrency is extremely low. As I previously wrote, "fee switches" are not a direct factor driving token prices up; rather, they set a floor for token prices. If a revenue-sharing mechanism is enabled and the revenue is substantial, then the token will become attractive at a certain price point, making it worth buying.
Looking at the top projects ranked by "holder income" on DeFillama, the situation seems clear: all high-income sharing tokens, except HYPE, have outperformed Ethereum.
While it may seem unfair compared to ETH, for most DeFi investors, ETH is the benchmark that every altcoin must surpass. Notably, UNI's performance stands out. Uniswap has finally activated the fee switch mechanism and even burned $100 million worth of UNI. If the fee switch had been effective from the inception of the protocol, these UNI should have been burned as well. (UNI initially rose about 75% but subsequently gave back all its gains.)
Fairly speaking, comparing these high-income tokens with those I will list below, which are subjective but have low yields, it seems that high-income tokens perform better during downturns. From this, three insights can be drawn:
Token buybacks set a price floor for tokens, not a ceiling.
In this cycle, everything is about trading. The rise and fall of UNI's token price around the announcement fully demonstrates this.
Buybacks are just one aspect of the issue; the volume of supply sold is equally important. Moreover, most tokens still have low circulation, and unlocking activities will continue in the coming years.
Stablecoins dominate attention, but (profitable) stablecoin proxy trading is hard to find
Last December, while traveling in Bali, I was first asked to use stablecoins for payment, marking the gradual mainstreaming of stablecoins.
That said, my previous judgment about the decline in USDT's market share was correct. USDT's market share dropped from 67% to 60%. Considering USDT's asset allocation structure, the risk-reward ratio of holding USDT does not match for me. Although USDT's market share has declined, its market cap continues to grow. Across the industry, Citibank predicts that by 2030, the market cap of stablecoins will grow from the current approximately $280 billion to $1.9 trillion (baseline scenario) or even $4 trillion (optimistic scenario).
In 2025, the narrative shifted from "trading" to "payment infrastructure," challenging traditional financial transaction models. Many projects, such as Ethereum, Tempo, Stable, and Plasma, are attempting to change the payment landscape.
However, trading around stablecoins is not easy. Circle's IPO performed exceptionally well initially but ultimately gave back all its gains. Proxy assets like Stable and Plasma have also underperformed.
The truth of 2025 is that everything, including the stablecoin narrative, is just trading.
It is certain that very few people use stablecoins directly for payments unless they use cryptocurrency cards. One reason stablecoins have rapidly gained popularity is that they can conveniently bypass banks and their strict anti-money laundering requirements, thus "achieving tax evasion."
The end result is an upward trend in demand for block space, as each card swipe generates a transaction on-chain. If there were a cryptocurrency card that could completely bypass Visa/Mastercard for direct peer-to-peer (P2P) payments, it would hold "tenfold" opportunities.
Currently, Payy, Kast, and Holyheld are all working towards this direction in various ways, and their token generation events (TGE) in 2026 may bring surprises.
DeFi is more centralized than CeFi
This is a bold viewpoint from DeFi Made Here (Fluid team), and its significance exceeds my expectations.
JPMorgan's market share in the U.S. is about 12%, while Aave's market share is as high as 50-70%.
Layer 2 networks (L2) are multi-signature systems worth billions of dollars that are unregulated.
Tether is an entity with hundreds of billions of multi-signatures.
Chainlink almost completely controls all the value in DeFi.
The same group of risk assessment teams serves different protocols, which clearly presents a conflict of interest.
This phenomenon of centralization is unrelated to the decentralized philosophy of blockchain or the principle of self-custody. In short, the business and total value locked (TVL) concentration in the DeFi space is higher than that in the CeFi space. An over-reliance on a few participants could harm the stable development of DeFi.
In the past year, another type of centralization has emerged in DeFi: conflicts have arisen between centralized equity holders and token holders/DAOs.
Who truly owns the protocol, intellectual property, and the resulting profits? The various controversies surrounding Aave indicate that token holders have fewer rights than we might imagine. As a representative of several DAOs, including Aave, I hold a firm stance on this issue: all revenues related to the protocol (including front-end fees) should flow to token holders.
However, centralized equity holders like "Labs" are understandably reluctant to relinquish control. But if "Labs" ultimately prevails, many DAO tokens will lose their investment value.
Uniswap's unified proposal (to burn tokens and align equity with tokens) sets a positive precedent. Now, Aave must follow suit. The year 2026 will be a key year for coordinating the interests of equity holders and token holders.
Final Conclusion
2025 has proven one thing: in the cryptocurrency market, everything is about trading. The exit window is extremely short, making it difficult to have full confidence in any token.
Thus, 2025 also marks the gradual decline of the "HODL" (hold on for dear life) culture. DeFi has evolved into on-chain finance, and with the improvement of the regulatory environment, DAOs are gradually shedding the false disguise of "decentralization."
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