Why underperformance might shape crypto’s 2026, and why trusting ETH over traditional banks could be smarter
Bitcoin and broader crypto markets have faced a tough 2025, lagging behind other assets like gold, silver, and tech stocks. Macroeconomist Jim Bianco shares a blunt analysis on what's causing this, where Bitcoin could be headed next, and why the real enemy isn’t Ethereum (ETH) but major institutions like JP Morgan and the Federal Reserve. If you want to decode crypto’s future and understand whether 2026 could finally be a year of value or more pain, Jim’s take is a must-hear. This article breaks down his key points, tackling adoption myths, price action predictions, and why some “crypto maxis” might be fighting the wrong battle.
How Has Crypto Underperformed in 2025 and What Does It Mean for 2026?
Crypto’s performance this year is unusually poor compared to a broad range of other investments. Bitcoin, the largest cryptocurrency, finished 2025 roughly flat — no gains, no losses. Meanwhile:
- Gold is up about 50%
- Silver surged 70%
- AI stocks and Nasdaq ETFs (e.g., QQQ) gained 20–50% depending on the segment
Jim Bianco warns crypto investors face an uphill battle: "I lost money in crypto. I could have thrown a dart and made more money anywhere else." This underperformance could dampen enthusiasm heading into 2026. ### Why the underperformance?
Crypto has traditionally mirrored highly speculative tech stocks (like QQQ), moving with risky investments. But in 2025, it decoupled from that pattern — a double-edged sword:
- Positive: Breaking correlation might help crypto develop as a unique asset in the long term
- Negative: The lack of price momentum undercuts one of crypto’s best marketing pitches — its growth potential
Jim pinpoints the core issue as confusion over “adoption.” The institutional embrace that was supposed to ignite growth is stalling, leaving the market directionless.
Institutional Adoption… or Regulatory Capture?
2024 and early 2025 were supposed to see a surge of “real adoption” driven by:
- Spot Bitcoin ETFs making it easy for mainstream investors (especially boomers) to buy crypto inside regular brokerage accounts
- Big corporate Bitcoin treasuries like MicroStrategy publicly holding large amounts
But the reality is more complicated. Jim compares crypto’s current path to a hypothetical Uber bought by taxi companies in the early days — a compromised vision.
“You want to drive out traditional finance, not get cozy with them.”
Instead, crypto looks like it’s becoming reliant on legacy institutions:
- JP Morgan
- Federal Reserve
- European Central Bank
Jim, who even interviewed for a Federal Reserve governor role in 2019, warns these institutions are not crypto’s allies. Their goal is control, not innovation or disruption.
Why Attacking Ethereum Is Missing the Point
Many crypto enthusiasts focus on bashing Ethereum — the second-largest network — for its flaws or regulatory challenges.
Jim urges to stop that, saying:
“You need ETH. ETH needs you. You don’t need JP Morgan. You don’t need the Federal Reserve.”
Ethereum plays a vital role in crypto’s infrastructure and innovation ecosystem. Turning your fire on it only divides the community when the real leverage lies with the entrenched financial powers.
Bitcoin Price Outlook: What Could 2026 Hold?
When asked about Bitcoin’s price a year from now, Jim offers a cautious view:
"I think we got to go below $74,000 first, maybe down..."
This suggests more volatility and possible temporary drops before any sustained rally.
Data Callout: Bitcoin’s all-time high was around $68,000 in late 2021. A move “below $74,000” implies a significant rebound is still needed from current levels under $40,000 (as of 2025).
This underscores that despite optimistic talk, the market is still navigating post-bull cycle adjustments.
Answer Box: Is crypto a good value asset for 2026?
Crypto’s value in 2026 depends on shifting investor motivations and institutional dynamics. While Bitcoin and Ethereum remain core technologies, 2025’s flat performance amid booming alternative assets raises concerns. Jim Bianco suggests 2026 could bring continued volatility before crypto rebuilds momentum, especially needing to break free from traditional finance’s influence.
What Could Go Wrong? Risks to Watch in Crypto
- Regulatory clampdowns could intensify as governments tighten frameworks on exchanges, stablecoins, and DeFi.
- Market sentiment might keep drifting away if better returns remain outside crypto.
- Adoption stalls if reliance on institutions like JP Morgan and the Fed further limits innovation.
- Internal division between Ethereum supporters and critics may fracture community efforts.
Crypto investors should stay alert to shifting macro factors and avoid assuming a quick turnaround.
Actionable Summary: Key Takeaways from Jim Bianco’s Outlook on Crypto
- 2025’s flat or negative crypto returns contrast sharply with strong gains in gold, silver, and tech stocks.
- Adoption hype clashed with reality, as institutional players seem more focused on control than disruption.
- Attacking Ethereum diverts energy from fighting the bigger challenge: traditional financial institutions.
- Bitcoin may test lower ranges in 2026 before any potential upside, signaling ongoing volatility.
- Crypto’s long-term value depends on breaking free from legacy systems, not integrating or trusting them.
Want a Deeper Dive?
Get the full playbook, entry signals, and risk management strategies in today’s Wolfy Wealth PRO brief. We analyze macro trends and on-chain data to help you stay ahead — no hype, just actionable insights.
FAQ
Q1: Why did crypto underperform compared to other assets in 2025?
Crypto decoupled from speculative tech stocks and struggled to gain adoption momentum. Other assets like gold and silver surged, making crypto’s flat returns less appealing.
Q2: What does “adoption” really mean in crypto?
Originally, it meant building a decentralized financial system independent from traditional banks. Now it often means getting approval and involvement from legacy institutions, which can limit innovation.
Q3: Should I view Ethereum as a competitor or a necessary part of crypto?
Ethereum remains central to crypto’s ecosystem through DeFi and smart contracts. Instead of opposing it, focusing on unity can strengthen crypto against external control.
Q4: What price does Jim Bianco predict for Bitcoin in 2026?
He suggests Bitcoin may drop below $74,000 before potentially recovering. This highlights ongoing volatility and uncertainty.
Q5: What are the main risks in the crypto market heading into 2026?
Risks include regulatory pressure, investor disillusionment, stalled innovation due to institutional ties, and community divisions.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Always conduct your own research or consult a professional before making investment decisions.
By Wolfy Wealth - Empowering crypto investors since 2016
Subscribe to Wolfy Wealth PRO
Disclosure: Authors may be crypto investors mentioned in this newsletter. Wolfy Wealth Crypto newsletter, does not represent an offer to trade securities or other financial instruments. Our analyses, information and investment strategies are for informational purposes only, in order to spread knowledge about the crypto market. Any investments in variable income may cause partial or total loss of the capital used. Therefore, the recipient of this newsletter should always develop their own analyses and investment strategies. In addition, any investment decisions should be based on the investor's risk profile
