Bitcoin consolidates its global hedge position, with ETFs expected to reach $400 billion by 2026

Source: PortaldoBitcoin Original Title: Bitcoin consolidates as a global hedge and ETFs will reach US$ 400 billion by 2026, estimates 21shares Original Link: Bitcoin and major cryptocurrencies are expected to see greater institutionalization and liquidity by 2026, as governments, banks, and other investors enter, with more ETP infrastructure and similar assets developing. This is the conclusion of 21shares’ “Cryptocurrency Landscape Report 2025,” with 21shares being a provider of cryptocurrency funds and exchange-traded products (ETPs/ETFs).

In this crypto market analysis, the 21shares research team believes Bitcoin should set new highs next year, but reaffirms that the four-year cycle characterizing this asset has been broken. This is because ETFs, corporate investors, and sovereign wealth funds absorbed six times the amount of Bitcoin mined last year.

Therefore, a cycle of higher liquidity and greater institutional participation is expected to emerge, making the price curve less sharp. “Each cycle now yields fewer exponential returns but also results in milder corrections, showing Bitcoin’s evolution. The halving may continue to be symbolic but no longer a driving force,” said Russell Barlow, CEO of 21shares.

“Since 2024, Bitcoin’s decline from its all-time high has never exceeded 30%, whereas previous cycles saw corrections of over 60%. In short, Bitcoin’s performance is no longer like small retail trades but more like a global macro hedge,” added Barlow.

Greater exposure of governments and banks to Bitcoin should spill over into other assets. 21shares estimates the global crypto asset ETP market will grow from US$ 250 billion this year to US$ 400 billion by 2026, surpassing the management scale of the world’s largest ETF (Nasdaq 100), despite fewer traditional investors.

“Only 27% of U.S. Bitcoin ETPs are managed by institutional accounts. There is still significant room for growth,” said Duncan Moir, Chairman of 21shares, who also emphasized the importance of global regulatory changes. “The U.S. Securities and Exchange Commission has opened the door for listings of assets like Solana, XRP, and Dogecoin. There are 120 ETP proposals under review. The UK has removed trading restrictions, and from Asia to Latin America, legal frameworks are being established to make crypto asset ETPs a global standard for regulatory access,” Barlow explained.

Last month, the U.S. Securities and Exchange Commission approved two ETFs from 21shares under the 1940 Investment Company Act, with the same standards as traditional investment funds, based on baskets of crypto assets. In September, the company launched its first products in Brazil, a major Latin American market, covering Bitcoin, Ethereum, Solana, XRP, and Cardano.

Stablecoin circulation triples

In the “Cryptocurrency Landscape Report 2025,” 21shares also estimates that the stablecoin market trading volume will reach US$ 1 trillion by the end of next year—currently at US$ 300 million. The industry has grown tenfold over five years, potentially driven by regulations in Europe and the US, with the White House hinting at progress in the coming years.

Optimistic forecasts also apply to decentralized finance (growing from US$ 130 billion to US$ 300 billion), the prediction industry (driven by US midterm elections), and DAT (rising from US$ 110 billion to US$ 250 billion), although the latter is expected to see market concentration.

In Brazil, 21shares estimates that by 2025, US$ 318 billion in crypto assets will circulate in the economy, with 90% being stablecoins. Remittances, trade, and payments are the main sectors. “Regulatory changes in 2023 have sparked market growth, and demand remains strong,” said Bruna Cabús, the company’s Latin America and Iberian Peninsula representative.

From a technical perspective, AI proxies should start taking their first steps, the report notes, applying to payments, liquidity management, and cross-blockchain transfers.

21shares investment strategist Maximiliaan Michielsen said: “Proxy economies represent a fundamental shift in finance, where AI proxies manage payments, yields, and liquidity across blockchains in an integrated manner, reducing friction and operational costs. As emerging platforms appear in this space, investors and consumers can now access complex multi-step financial strategies through simple language commands. As infrastructure and protocols mature, AI-driven DeFi will not only automate tasks but also create a whole new category of autonomous and investable capital, revealing unprecedented efficiency, scalability, and opportunities in the decentralized economy.”