2026 is expected to be a pivotal year for risky assets

Looking back, 2025 has been an especially impressive year for (almost) all types of investment assets. Unless the market experiences strong volatility in the last few days of the year, the S&P 500 is likely to close with an increase of about 18%, the Nasdaq Composite up 22%, and the Dow Jones Industrial Average up 15%.

Precious metals also marked a booming year. The two largest assets, gold and silver, both set multiple new all-time highs, marking the best growth year ever. Gold increased by 75% from the beginning of the year, while silver surged 172% compared to January’s opening price, bringing its market capitalization to around $4.5 trillion and making it the third-largest global asset.

If there is a group of assets that has disappointed, it is crypto. Although Bitcoin and some altcoins continuously hit new highs during the year, most of the market is still preparing to close 2025 in the red. However, renowned analysts from Kobeissi Letter believe that 2026 will be even more positive. The question is: can crypto outperform?

2026 Expected to Explode

According to Kobeissi Letter, many factors suggest that 2026 is forecasted to be a “huge” year for the global financial markets: the AI wave continues to accelerate, including the tense competition between China and the US; regulatory easing trends in the tech sector; the US midterm elections; the increase in retail flows in some markets; along with the policy direction of the US Federal Reserve (Fed).

In 2025, the Fed cut interest rates three consecutive times and ended its quantitative tightening policy. Next year, the US central bank is expected to continue lowering interest rates, especially with a new Fed Chair. Former President Donald Trump has called for interest rates to be brought down to 1% and pledged to implement stimulus packages funded by tariffs.

Can Crypto Catch the Wave?

As mentioned, Bitcoin and most altcoins generally underperformed throughout 2025. However, if the above macro factors converge simultaneously, high-risk assets like digital assets theoretically stand to benefit, especially as borrowing costs in the US continue to decline and other asset classes like precious metals or stocks approach important peaks.

Many experts forecast that capital will rotate into sectors with higher profit potential, including crypto. AI is likely still the most attractive area, but Bitcoin has become significantly more “mainstream” in the eyes of institutional investors, especially since the Trump administration took office.

Regardless, 2026 is gradually emerging as a volatile and opportunity-filled period for the entire financial market. For Bitcoin and altcoins, the road ahead remains long after a controversial 2025 — or perhaps, that very controversy opens up greater growth potential.