Bitwise Lists 3 Key Conditions for Crypto to Hit New Highs in 2026

TLDR

• Bitwise reported that crypto markets began 2026 with strong gains across major assets.
• Bitcoin rose by 7% this year and crossed the $91,000 mark by January 6.
• Ether also gained 7% in the same period and reached over $3,100.
• Bitwise stated that the absence of large-scale liquidations helped improve market sentiment.
• The October 2025 liquidation event wiped out $19 billion in crypto futures in a single day.

The crypto market started 2026 with strength as key digital assets posted early gains, but risks still remain, Bitwise said, and the firm outlined three essential conditions that must hold for this rally to lead to new highs this year.

Bitcoin Gains as Selling Pressures Ease

Bitcoin rose 7% year-to-date, reaching $91,409.17, supported by lower market volatility and reduced liquidation fears, according to Bitwise.

Bitwise CIO Matt Hougan stated, “The absence of another major liquidation event is encouraging and could mean we’ve cleared that hurdle.”

On October 10, 2025, a $19 billion crypto futures liquidation rocked the market and sparked fears of more forced selling.

Since then, investor sentiment has improved, and large market players have not shown signs of distress entering 2026.

Bitwise suggested that any necessary unwinding likely occurred before year-end, easing concerns around systemic risk in the near term.

Ether Moves Higher While Policy Outlook Remains Key

Ether climbed around 7% to $3,166.74 since the beginning of the year, reflecting renewed optimism across crypto.

However, Hougan emphasized the importance of progress in U.S. crypto legislation moving through Congress in early 2026.

“The outlook depends on the success of the proposed crypto market structure bill,” Hougan noted in the Bitwise blog post.

The Senate Banking Committee may mark up the bill in mid-January, but the date still awaits confirmation.

Policy discussions remain active around decentralized finance, stablecoin incentives, and broader regulatory clarity in Washington.

Bitwise said the bill’s passage would help protect current regulatory trends from reversal by future administrations.

DOGE Leads Risk-On Rally as Market Eyes Equities

DOGE surged roughly 29% in early 2026, suggesting growing risk appetite is spreading beyond large-cap crypto assets.

Bitwise said speculative token gains reflect broader investor confidence, but one condition still hinges on external markets.

Hougan noted that crypto markets could suffer if equities drop sharply, even without strong direct correlation.

“A 20% drop in the S&P 500 would likely weigh on all risk assets,” he said.

Though recession odds appear low, a stable equity backdrop remains vital to support digital assets’ momentum.

Bitwise also cited increasing stablecoin adoption, institutional activity, and improved regulation from early 2025 as current drivers.

The firm concluded that crypto’s early-year strength may hold if these three conditions continue through 2026.

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