The crypto winter may reappear in 2026, but Cantor Fitzgerald foresees a new era of institutional growth and on-chain transformation

Well-known financial institution Cantor Fitzgerald pointed out in its latest year-end report that the cryptocurrency market may be entering the early stages of a new “crypto winter,” which could echo Bitcoin’s approximately four-year cycle pattern. However, unlike previous cycles, this adjustment is expected to be less chaotic, more institution-led, and increasingly defined by decentralized finance, real-world asset tokenization, and clearer regulation. Data from the report shows that the on-chain RWA total value has surged to $18.5 billion this year and is expected to surpass $50 billion by 2026. Although Bitcoin prices may face pressure, the market infrastructure and participants are undergoing profound structural changes, laying the foundation for more sustainable growth in the next cycle.

Market Cycle Turning Point: An “Institutionalized” Crypto Winter Is Brewing

According to Cantor Fitzgerald analyst Brett Knoblauch’s year-end report, the current market is likely in the early stages of a new “crypto winter.” This judgment is mainly based on the approximately 85 days since Bitcoin’s peak, aligning with historical cycle patterns. The report predicts that price pressure could persist for several months, possibly testing the breakeven point of large Bitcoin holders like MicroStrategy, estimated around $75,000. This analysis is not unfounded but is based on observations of market behavior following multiple Bitcoin halving cycles, providing investors with a clear timeframe to understand the current market phase.

However, Knoblauch keenly points out that this potential downturn will differ fundamentally from past patterns. Previous crypto winters often involved large-scale leverage liquidations, project failures, and retail panic selling, resulting in high volatility and disorder. But this time, the “profile” of the market is being shaped by a different group—institutions. Retail influence is relatively diminished, while institutional funds with longer investment horizons and stronger risk management are becoming key drivers of market depth and stability. This shift suggests that market volatility may become more “orderly,” and the decline may no longer be accompanied by severe liquidations and liquidity crunches.

This institution-led pattern also causes a growing “gap” between token prices and actual on-chain activity. The report emphasizes that despite potential weakness in secondary market prices, on-chain infrastructure development, DeFi protocol innovation, and real-world asset migration are not slowing down—in fact, they are accelerating. This reveals a core trend: the valuation dimensions of the crypto market are diversifying, no longer driven solely by speculative trading. The adoption of underlying technology applications and the digitization of financial assets are becoming vital value supports. Therefore, for investors, focusing solely on price charts may no longer suffice; in-depth analysis of on-chain data and ecosystem development is equally crucial.

On-Chain Transformation Accelerates: RWA and DEX as Growth Engines Against the Trend

In the context of potential market adjustments, certain key areas of the on-chain ecosystem demonstrate strong counter-cyclical resilience, with real-world asset tokenization being one of the most prominent trends. According to Cantor’s report, the total value of tokenized RWA on-chain has tripled this year, reaching $18.5 billion. These assets are diverse, including credit products, U.S. Treasuries, corporate equity, and other core financial instruments. This growth is not accidental; it reflects increasing interest from global financial institutions in using blockchain technology for issuance, settlement, and management of assets, aiming for higher efficiency, transparency, and accessibility.

Cantor predicts that this growth momentum will accelerate over the next two years. The report boldly forecasts that by 2026, the on-chain RWA scale could surpass $50 billion. The key drivers include more mainstream banks, asset managers, and hedge funds moving from experimental pilots to scaled deployment. For example, tokenizing government bonds or money market funds can provide global investors with seamless 24/7 access and near real-time settlement. This process is not just a technological shift but a profound transformation of the financial paradigm, pushing blockchain from niche innovation to a core part of mainstream financial infrastructure.

Meanwhile, trading venues are quietly but continuously shifting. Decentralized exchanges (DEXs) are steadily gaining market share from centralized platforms. The report admits that as Bitcoin prices potentially weaken by 2026, overall trading volume in the crypto market might decline. However, DEXs—especially those offering perpetual futures—are expected to continue growing. The driving forces include ongoing infrastructure improvements and better user experiences: lower slippage, more efficient cross-chain solutions, and more user-friendly interfaces are lowering the barriers for ordinary users to enter DeFi. This structural shift means that even in a “winter,” core activities like value exchange and financial innovation will thrive on decentralized platforms.

Major RWA Protocols Overview

To better understand this trend, here are some key RWA protocols currently in the market and their positioning, forming the foundation of the on-chain real-world asset ecosystem:

Ondo Finance: Focuses on tokenizing U.S. Treasuries and high-quality liquid assets, with products like OUSG providing investors with on-chain access to short-term government debt.

Maple Finance: An institutional-grade lending marketplace connecting institutional borrowers with crypto-native capital providers via on-chain lending pools, mainly for corporate loans.

Centrifuge: Dedicated to transforming real-world assets (such as invoices, real estate mortgages) into financeable NFT assets, facilitating decentralized financing through its platform.

Goldfinch: A no-overcollateralization lending protocol primarily serving small and medium-sized enterprises in emerging markets worldwide, offering yields based on borrower credit assessments rather than crypto collateral.

Regulatory Clarity: Paving the Way for Large-Scale Institutional Entry

Beyond endogenous market dynamics, external regulatory developments are becoming decisive in reshaping the industry landscape. Cantor’s report highlights the significance of the recent U.S. passage of the “Digital Asset Market Clarity Act,” viewing it as a pivotal turning point. The core contribution of this legislation is the legal clarification of when digital assets should be classified as “securities” or “commodities,” and designating the U.S. Commodity Futures Trading Commission (CFTC) as the primary regulator for assets and markets that meet certain decentralization thresholds. This delineation is crucial because it ends long-standing regulatory ambiguity, providing a predictable legal framework for project compliance.

Regulatory clarity directly reduces the “headline risk” for the industry. Previously, sudden enforcement actions or vague regulatory statements often triggered market volatility. Now, clear rules enable traditional financial institutions like banks and asset managers to participate in crypto markets with lower compliance costs and legal uncertainties. They can design compliant structured products, offer crypto exposure to clients, or integrate blockchain technology into their clearing and settlement operations. The once-opaque door is now being officially opened, bringing unprecedented capital and expertise into the market.

More importantly, the CLARITY law offers a feasible compliance pathway for decentralized protocols themselves. The report notes that compliance has always been a major obstacle for DeFi protocols. Now, by setting specific standards such as “decentralization thresholds,” genuinely decentralized protocols may attain legal status under CFTC regulation. This not only enhances DeFi’s legitimacy but also encourages project teams to incorporate compliance considerations from the early development stages. A DeFi ecosystem operating under clear rules is highly attractive to institutional capital seeking safety and stable returns. Therefore, regulatory evolution is not stifling innovation but clearing obstacles for larger, more robust institutional applications.

Emerging Sectors and Potential Risks: Market Growth and Fragility Coexist

Beyond mainstream trends, Cantor’s report reveals some high-growth niche sectors, notably on-chain prediction markets, especially in sports betting. Data shows that trading volume in this area has expanded to over $5.9 billion, surpassing even DraftKings’ total third-quarter betting handle by 50%. Traditional fintech and crypto firms like Robinhood and Coinbase have entered this space, introducing order-book-based, more transparent models that challenge traditional betting industries. This not only expands crypto use cases but also indicates that blockchain-based decentralized information and value prediction networks could disrupt traditional middlemen in more sectors.

However, amidst this structural positive shift, short-term risks remain. The report highlights several vulnerabilities. The first is the delicate relationship between Bitcoin’s price and the cost basis of large holders. Currently, Bitcoin’s price is only about 17% above MicroStrategy’s average cost basis. This “average cost line” is a key psychological and technical support level. If prices fall below it, concerns may arise about these “diamond hands” being forced to sell, potentially triggering panic. While Cantor believes MicroStrategy is unlikely to sell proactively, market sentiment can make this psychological threshold more impactful than fundamentals.

Another concern is the flow of funds into digital asset trusts, once a primary channel for institutional entry. As token prices decline, the premiums or discounts of these trusts relative to NAV have narrowed, reducing their appeal as arbitrage or high-premium allocation tools. This indicates that institutional entry methods are becoming more diversified—direct purchases on compliant exchanges, participation in DeFi, or investments in RWA products are replacing reliance on single trust products. This shift is healthy, reflecting deeper institutional engagement, but also suggests that the “thermometer” of institutional interest may need recalibration.

Outlook for 2026: Foundation Year, Not Explosion Year—Waiting for Steady Growth

Overall, Cantor Fitzgerald’s outlook for 2026 is one of “solidifying foundations” rather than “expecting a breakout.” The report hints that the market may not immediately usher in the next epic bull run in prices. Instead, 2026 is more likely to be a period of integration and building. Beneath the price cooling, profound internal changes are occurring: institutional participation frameworks are consolidating, regulatory moats are forming, key on-chain infrastructure is improving, and real-world assets continue to flow in. These changes are like hidden currents beneath the ice—powerful yet not directly observable—and they collectively pave the way for crypto to integrate into the global macro financial system.

For different market participants, this phase means different strategies. Long-term investors and institutions might see it as an opportunity for strategic positioning, focusing on projects with genuine technological and commercial advantages in DeFi, RWA, and compliant infrastructure. Traders may face a range-bound market driven by macroeconomic factors, liquidity cycles, and industry-specific events, requiring higher risk management and timing skills. Ecosystem builders will find that clear regulation and institutional demand provide more defined directions for product innovation.

Ultimately, Cantor’s report depicts an industry evolving from “wild growth” to “meticulous cultivation.” The potential “crypto winter” may no longer be a doomsday scenario but rather a period of industry renewal and stress testing—eliminating fragile speculative models and leaving solid institutional applications and technological innovation. When price momentum temporarily pauses, it is the best time to observe fundamental industry shifts. 2026 is likely to be remembered as a key year when crypto moved from the fringes to the mainstream, from speculative assets to financial infrastructure. After winter, it may not be fireworks but a broader, more stable, and vibrant new ecosystem.