Fidelity's 2026 Crypto Market Outlook: We May Be Entering a Supercycle, with a Bull Market Lasting for Many Years

Author: Fidelity Investments

Compiled by: Nicky , Foresight News

TL;DR:

Investors looking to enter the market for short-term profits should exercise caution. However, those planning for long-term holding may not have missed their opportunity. This year, more governments and businesses around the world have added digital assets to their balance sheets. Due to this increased demand, some investors believe the traditional four-year cycle of cryptocurrencies may have come to an end.

In March, President Trump signed an executive order establishing a strategic Bitcoin reserve for the U.S. government. This order formally designated all Bitcoin and several other cryptocurrencies currently held by the government as reserve assets.

While the full impact of this executive order remains to be seen, one thing is clear from 2025: cryptocurrencies are gaining mainstream acceptance. They are no longer merely seen as a form of volatile speculation by "degens" (short for "degenerate," a term used by cryptocurrency traders to describe the volatile nature of the cryptocurrency market and the mindset required to survive in it), but rather as a store of value recognized by the U.S. government.

What does this mean for the cryptocurrency market as we head into 2026? Does the significant price pullback we're seeing now mean the bull market is over? Is it too late to invest in cryptocurrencies now? Here are a few key trends to watch.

Will more countries adopt cryptocurrency reserves?

Many countries around the world currently hold a certain amount of cryptocurrency, but few countries have formally established cryptocurrency reserves—that is, designated their cryptocurrency holdings as financial assets serving national strategic interests.

This situation began to change in 2025 (most notably President Trump’s executive order in March) and could continue to evolve into 2026.

For example, in September, Kyrgyzstan passed a bill to establish its own cryptocurrency reserve. Elsewhere, more countries are beginning to explore this possibility. The Brazilian Congress recently pushed forward a bill allowing up to 5% of the country's international reserves to be used to hold Bitcoin (though whether this bill will become law remains to be seen).

"Fidelity Digital Assets believes that more countries may buy Bitcoin in the future, based on game theory," said Chris Kuiper, vice president of research at Fidelity Digital Assets. "If more countries include Bitcoin in their foreign exchange reserves, other countries may also feel competitive pressure, thus increasing the pressure to do the same."

What does this mean for the price? "From a simple supply and demand economics perspective, any additional demand for Bitcoin could push up the price," Quiper said. "Of course, the key is how much incremental demand there is, and whether other investors are selling or holding."

Will businesses continue to buy cryptocurrencies?

Governments are not the only potential source of new demand in 2026. Businesses are likely to become increasingly involved—some of which are already adding Bitcoin and other cryptocurrencies to their balance sheets by 2025. One of the most notable examples to date is software and analytics company Strategy (formerly MicroStrategy, ticker symbol MSTR), which has been steadily buying Bitcoin since 2020. However, more companies have taken this step this year, making it a trend. As of November, well over 100 publicly traded companies (both domestic and international) hold cryptocurrencies. Approximately 50 of these companies currently hold more than 1 million Bitcoins.

"There are clearly arbitrage opportunities, and some companies can leverage their market position or access to funding to buy Bitcoin," Quiper said. "Some of this stems from investment authorization and geographical and regulatory issues. For example, investors who cannot directly buy Bitcoin may choose to gain exposure through these companies or the securities they issue."

On the surface, corporate purchases of cryptocurrencies increase market demand, which helps drive up asset prices. However, investors should also be aware of the risks involved. "If these companies choose or are forced to sell some of their digital assets—for example, during a bear market—this could certainly put downward pressure on the price of the Bitcoin or other digital assets they hold," Quiper said.

Image source: Fidelity Investments. Past performance is not indicative of future results.

Will the four-year cycle end?

Compared to traditional investments like stocks and bonds, Bitcoin has a relatively short history, but its price generally follows a four-year cycle (from bull market peak to bull market peak, or from bear market trough to bear market trough). It formed bull market peaks in November 2013, December 2017, and November 2021, and bear market troughs in January 2015, December 2018, and November 2022. These cycles are accompanied by significant price fluctuations: the first cycle saw a drop from $1,150 to $152, the second from $19,800 to $3,200, and the third from $69,000 to $15,500.

Bitcoin's price movements often drive the entire cryptocurrency market – and in many cases, the volatility is even greater.

We are currently at approximately the four-year mark of the current cycle, as the last bull market peaked in November 2021. Over the past month, cryptocurrency prices have continued to decline. So, has this bull market already peaked?

If the four-year cycle repeats itself, we may be at or near the end of this Bitcoin bull market. However, some cryptocurrency investors believe that this historical trend is about to end, and the current price pullback is merely a temporary retracement before the market resumes its upward trend.

Specifically, what does this mean? Some investors believe that while price pullbacks will still occur, any declines will be far less volatile than in the past, and the magnitude may be so small as to not feel like a full-blown bear market. Others believe we may be entering a supercycle, with the bull market lasting for many years. For reference, the commodity supercycle of the 2000s lasted nearly a decade.

Quipper doesn't believe these cycles will disappear entirely, because the fear and greed that trigger them haven't magically vanished. However, he points out that if a four-year cycle were to repeat itself, we should have already reached the all-time high of this cycle and entered a full bear market. While the pullback since November has been quite severe so far, he suggests we may not be able to confirm whether a four-year cycle has truly formed until 2026. The current price decline could be the start of a new bear market, or it could simply be a correction within a bull market, leading to new all-time highs in the future—as we've seen several times in this cycle.

Whether these predictions will come true remains to be seen; we may not be able to determine this until mid-2026.

Is it too late to buy Bitcoin now?

Despite the many uncertainties that remain in the cryptocurrency market, one thing is becoming clearer: the crypto market is entering a new paradigm. "We are seeing a radical shift in investor structure and categories, and I think this will continue into 2026," Quiper said. "Traditional fund managers and investors have started buying Bitcoin and other digital assets, but in terms of the amount of money they may bring into this space, I think we've only scratched the surface."

In light of this, investors who have not yet entered the market may ask: Is now still a good time to buy Bitcoin?

For Quipper, it depends on your investment horizon. If you're hoping to reap returns in the short to medium term (four to five years or less), you may already be too late, especially if this cycle ultimately follows historical patterns.

"However, over a very long time span, I personally believe that if you view Bitcoin as a store of value, then you are never fundamentally 'too late'," Quiper said. "As long as its hard supply cap remains constant, I believe that every time you buy Bitcoin, you are putting your labor or savings into something that will not be devalued by inflation caused by government monetary policy."