VanEck Predicts Risk-On Q1 While Bitcoin Defies Past Cycles

While the firm sees a more stable macro backdrop forming as US deficits shrink relative to GDP, it is still cautious on Bitcoin in the near term as its traditional four-year cycle appears to have broken in 2025. Analysts largely view the outlook through a medium-term lens, arguing that excess leverage has been cleared and that improving regulatory clarity, fiscal support, and geopolitical pressures are creating an environment that could ultimately benefit Bitcoin and crypto markets in the first half of the year.

Risk-On Conditions Emerge

Global investment management firm VanEck shared its outlook for the first quarter of 2026, arguing that markets are entering a rare period of improved visibility after years of uncertainty. In its Q1 2026 outlook, the firm said investors now have clearer signals around fiscal policy, monetary direction, and dominant investment themes. These conditions typically support a risk-on environment across financial markets.

X post from VanEck

That backdrop is generally favorable for higher-risk assets like technology stocks, artificial intelligence plays, and cryptocurrencies. However, VanEck struck a more nuanced tone when it comes to Bitcoin, and pointed out that the asset’s traditional four-year cycle appears to have broken in 2025. According to the firm, this disruption complicates short-term signals and supports a more cautious outlook over the next three to six months, even as some executives in the company are more optimistic about Bitcoin’s immediate trajectory.

BTC’s price action over the past 6 months (Source: CoinCodex)

VanEck also pointed to a gradual improvement in the US fiscal picture as a key macro driver. While deficits remain elevated, they are shrinking as a percentage of GDP compared with the extreme levels seen during the COVID period. The firm said this fiscal stabilization is helping to anchor longer-term interest rates and reduce tail risks, which contributes to a more stable environment for markets overall.

Analysts mostly agree that the outlook should be viewed through a medium-term lens rather than focused on short-term price swings. Justin d’Anethan, head of research at Arctic Digital, said recent price action suggests excess leverage has been flushed out of the system. He argued that Bitcoin’s rise in a low-leverage environment points to healthier market conditions, with bullish sentiment becoming more grounded and bearish forecasts losing their more extreme edge.

Others see a clearer runway forming for the first half of the year. Tim Sun, senior researcher at HashKey Group, said that after the volatility and adjustments of late 2025, the market trajectory for the first half of 2026 now appears relatively well defined. With US midterm elections approaching, he expects fiscal and financial conditions to increasingly favor risk assets, supported by stimulus, accommodative monetary policy, and improving regulatory clarity.

Broader macro conditions are also fueling optimism among crypto investors. Will Clemente said that rising geopolitical risk, pressure on central banks, strong equity markets, and sovereign diversification into alternative assets create an environment that is closely aligned with Bitcoin’s original investment thesis.