In 2026, the continued rise of cryptocurrencies will need to overcome three major obstacles, with U.S. legislation being the key

【Blockchain Rhythm】Bitwise Chief Investment Officer Matt Hougan recently discussed a topic—cryptocurrency needs to clear three hurdles to continue thriving in 2026.

The first hurdle has basically been safely passed. It concerns the risk of large-scale liquidations. Remember those previous crashes? The market was afraid of repeating them. But recently, the market has been stable, and there haven’t been any large liquidation events by the end of 2025, so this concern has largely dissipated.

The real key is the second hurdle—legislation in the United States. Especially whether the “Cryptocurrency Market Structure Act” can pass, which will determine many things. This bill is currently progressing in Congress, with the Senate expected to review it by January 15. But the issues of how to regulate DeFi, stablecoins, and the political conflicts of interest among various parties are still unresolved. Once this bill is truly approved, it will mean that the U.S. will embed crypto-friendly regulatory principles into law, making it less likely to be changed by future political shifts. This is a long-term reassurance for the market.

The third hurdle is the correlation with the stock market. Hougan said that cryptocurrency prices don’t necessarily have to rise along with the stock market, but if the stock market crashes, it could drag all risk assets down in the short term, and cryptocurrencies are no exception. Although current market expectations suggest that a recession in 2026 is unlikely and the probability of a U.S. stock rally is quite high, there are still uncertainties in this matter.