The cryptocurrency market has reached another critical turning point at the end of 2025 and the start of 2026—many are questioning whether 2026 will be a year of bullish growth or renewed volatility?
Looking at the broader picture—from the global economy, U.S. politics, the AI Bubble trend, to institutional capital flows—it becomes clear that the market is entering a period of highly conflicting information (Mixed Signals) not seen in years. Rational interpretation of this data will be key for investors in determining whether the coming year will bring opportunity or require extra caution.
The global economy remains the most influential variable driving Bitcoin and cryptocurrency trends.Three main components are crucial: Japan, the United States, and worldwide liquidity.
Japan (BOJ) and the Impact on Carry Trade - The Bank of Japan’s interest rate hikes significantly increase the cost for those borrowing low-interest yen to invest in risky assets. While some investors believe the latest impact won't be as severe as before due to prior market anticipation, it remains a pressure point to monitor closely.
United States: The New Fed and President Trump's Influence - The market expects 3–4 interest rate cuts next year, with frontrunner Fed Chair candidate Kevin Hassett likely to pursue a "Dovish and Aggressive" policy—prioritizing economic stimulus over inflation control. Should the Fed ease quickly, this would be very positive for Bitcoin and other risk assets.
Liquidity (M2): Why isn't new money flowing into crypto? - Despite M2 expansion, funds are flowing more into gold, silver, and AI stocks than crypto. This reflects a "Mindshare Shifting"—new capital is waiting for more confirmation before re-entering the crypto market in force.
The Chance of a Recession Is Very Low - Polymarket data indicates the risk of a 2026 recession is "the lowest in years," which is positive for risk assets. In summary, the macro outlook for next year is “more positive than negative,” assuming the Fed cuts rates swiftly and no severe geopolitical events occur.
One of the biggest questions this year is: "Is the AI market already in a bubble?"
Analysis shows it is "not yet a bubble" for four main reasons indicating ongoing growth potential:
1. Non-Parabolic Price Action
The price increases of AI-related stocks have not been parabolic (irrationally steep), a classic bubble signal. The current situation is clearly far from a "bubble" like the Dot-com Bubble era.
2. Lack of Small Cap Participation
In a full bubble, small-cap stocks lacking strong business fundamentals typically surge irrationally. Currently, AI-related small caps have not shown significant price spikes, an important missing signal for bubble classification.
3. Growth Backed by Fundamentals
The AI market’s expansion today differs notably from other bubbles because growth is based on tangible fundamentals, not just speculation:
Clear earnings Leading companies report sharply rising revenues and profits driven by commercial technology adoption, not just irrational stock price increases.
Widespread real-world usage: AI technologies like ChatGPT and Generative AI have moved from concept to practical daily and business applications worldwide, improving efficiency, cutting costs, and driving innovation.
Sustainable value creation: This momentum is not a fleeting trend but creates sustainable economic value supported by real operational results. Current growth is driven by generating actual cash flow and profits, confirming the AI market remains in a development and expansion phase based on potential, not emotional speculation.
Current market analysis shows Bitcoin’s "old cycle" is undergoing significant transformation. The market, once driven by retail traders, is now clearly influenced by institutional investors and new investment tools like Spot ETFs. Large institutional capital worldwide is reshaping the market structure, so the traditional four-year cycle many relied on may no longer hold as sacrosanct.
Overall, the recovery is expected to follow a K-Shape pattern: Bitcoin has a better chance to continue strongly, while most altcoins are likely to stagnate. A broad "Altcoin Season" like in 2017 or 2021 is now much less likely, mainly because a flood of new tokens dilutes investment capital, making it impossible to lift all tokens together. Thus, investment strategies must shift from "buying the whole board" to truly selective plays.
On-chain data shows mixed signals, making it unreliable as the sole guide. On one hand, experienced "Smart Money" investors are gradually taking profits as prices improve and market cost structures deteriorate. On the other, key bubble indicators like MVRV or RHODL do not yet warn of a market peak. This suggests the market may still have room for Bitcoin to advance, albeit with more caution than before.
Amid unclear signals, the key strategy is not to "guess direction" but to "select and manage risk." Investors should prioritize three main factors: visionary and responsible management teams focused on the ecosystem; projects with sustained growth in chain activity, developers, users, and Dapps; and real-world user adoption answering the question, "Will there be more users in five years than today?"
Regarding portfolio management, those already holding assets might adopt a "Let Profit Run" approach rather than rushing to sell due to short-term volatility. Those mainly in cash should wait for clear signals and opportunities. Crucially, avoid falling into FOMO by indiscriminately buying altcoins without strategy. Equally important is risk diversification through appropriate asset allocation; crypto should not constitute 100% of a portfolio but serve as one tool within a long-term wealth management plan.
After weighing positives and negatives, it is agreed that while the next one to two months likely won’t see new all-time highs, this period will serve as an important consolidation phase. It will await new catalysts in 2026 such as Fed rate cuts, renewed institutional inflows into Bitcoin, or the emergence of a new AI-driven economic model poised to transform traditional investment systems.
In this context, 2026 is unlikely to be a year for gambling but will demand more precise "selection accuracy" than ever. Only a few projects with truly strong fundamentals will become the main drivers of returns for Thai investors in the coming months.