Grayscale predicts Bitcoin will reach new highs, dismisses 4-year cycle
Grayscale Research has projected that bitcoin could achieve new all-time highs in 2026, defying widespread expectations of a prolonged downturn linked to the asset’s historical four-year cycle. In their latest report, the Grayscale analysts challenged the common belief that bitcoin’s price is bound to follow a pattern of peaking and then sharply correcting every four years, as dictated by its halving schedule. The firm expressed uncertainty about the future but expressed belief in the inaccuracy of the four-year cycle thesis, instead suggesting that bitcoin’s price could possibly reach new highs next year.
Bitcoin has undergone significant price turbulence in recent months, experiencing a 32% drop from its peak since the start of October. Despite this drop, the price briefly surged to $84,000 on Monday before settling at $86,909, showcasing the asset’s characteristic price volatility. Grayscale emphasized that drawdowns of 25% or more are common during bullish markets and do not necessarily indicate the beginning of a bear market.
Unlike previous cycles, Grayscale pointed out that the current market has not witnessed the typical parabolic rally often seen prior to a market reversal. Institutional involvement through exchange-traded products and digital asset treasuries has replaced the retail-driven activity that characterized earlier bull markets. The report also noted a supportive macroeconomic environment, highlighting the potential for interest rate cuts and positive progress on U.S. bitcoin legislation as factors contributing to market confidence.
BitMine CEO Tom Lee echoed Grayscale’s optimism, citing strong on-chain fundamentals despite recent price drops. Lee indicated that cryptocurrency prices have been steadily declining, while metrics related to wallets, on-chain activity, fees, and tokenization have shown progress. In an interview with CNBC, Lee expressed his expectation that bitcoin will reach a new all-time high by January 2026.
Overall, the outlook for bitcoin’s future remains uncertain, with Grayscale Research and other industry experts predicting potential new highs for the cryptocurrency in 2026. The defiance of the traditional four-year cycle suggests a shift in market dynamics driven by institutional participation, macroeconomic conditions, and strong on-chain fundamentals. Despite recent price declines, market sentiment remains positive regarding the long-term growth potential of bitcoin.
