Despite a losing year, the cryptocurrency appears to be on track for a much better year in 2026, thanks to a series of catalysts that could propel bitcoin to new record highs.
There’s no denying that, after two years of over 100 percent returns, bitcoin has disappointed investors in 2025. However, despite a losing year, this cryptocurrency appears to be on track for a much more successful year in 2026, thanks to a series of catalysts that could push bitcoin to new records, according to crypto brokerage and research company K33, reports Business Insider.
In a recent report to clients, the firm said it believes much of bitcoin’s underperformance in 2025 can be attributed to “isolated bubbles” and “temporary leverage imbalances” in the crypto market.
“When prices and fundamentals move in opposite directions, opportunities arise. With that in mind, we enter 2026 with a constructively optimistic view,” the report said. “Bitcoin will outperform stock indexes and gold in 2026,” the analysts added, listing six key catalysts that they estimate could push bitcoin’s price higher.
The first reason is the fact that bitcoin is currently trading at so-called “pre-Trump levels”, which makes it attractive from a valuation point of view. Bitcoin, which entered a technical bear market in November, is down about 44 percent from a high of about $126,000. It’s also about 24 percent below the $109,000 level it broke on Donald Trump’s inauguration day.
“K33 believes that BTC is fundamentally undervalued relative to other asset classes,” the report said.
Another important factor is the expectation that the US central bank (Fed) will continue to cut interest rates throughout 2026, which should increase investor appetite for riskier assets, including cryptocurrencies. Although the Fed is expected to keep interest rates at their current level at the January meeting, markets are currently counting on a 74 percent chance of two or more rate cuts by the end of next year.
“This monetary policy environment is significantly different from that of 2018 and 2022, reducing the likelihood of a repeat of previous market patterns,” K33 said, alluding to bitcoin’s earlier bear markets.
Further, the company speculates that Donald Trump is likely to “watch his back” for bitcoin and will continue his efforts to integrate cryptocurrencies deeper into the financial system. Trump has long positioned himself as a crypto-friendly president, and during his second term he signed a series of executive orders that positively affected market sentiment, appointed crypto-friendly staff in the administration and even launched his own meme coin.
“Bitcoin and the crypto sector have the support of the administration,” they claim in K33. “Bitcoin prices have yet to reflect this change, and we believe 2026 represents a strong opportunity for bitcoin and other cryptocurrencies in the context of increasing integration with traditional finance.”
Equally important, although less well known, is the information about the American strategic reserve of bitcoins. Although little public information is available, the US government is estimated to hold approximately 233,736 bitcoins, worth approximately $20 billion, according to K33’s latest estimates.
“Even if the US government never buys additional BTC, the holding strategy itself has a net positive effect on the market. Previously, seized bitcoins were seen as an inevitable source of selling pressure; now they are effectively withdrawn from the market and held,” the company explains.
Considerable potential, according to K33, also lies in pension funds. In August, Trump signed an executive order asking regulators to review rules related to 401(k) retirement accounts, which could make it easier to invest in alternative assets, including cryptocurrencies. K33 estimates that allocating just one percent of 401(k) account funds to bitcoin would represent about $87 billion worth of additional demand.
“Combined with the support of financial advisors from Morgan Stanley and Bank of America, this creates a strong foundation for significant BTC absorption throughout 2026 and, in our view, remains a seriously undervalued market driver.”
Finally, there is regulatory clarity. The CLARITY Act, a landmark cryptocurrency bill that defines a framework for the use and distribution of digital assets by banks and crypto companies, passed the House of Representatives over the summer. The Senate is expected to vote on this bill in the first quarter of next year, which, according to K33, could significantly increase the presence of cryptocurrencies in the traditional financial system and represent an additional positive signal for the price of bitcoin.
“Banks have arrived, and their presence will further intensify,” K33 analysts conclude.
