Crypto investment firm and ETF issuer 21Shares entered 2026 predicting that Bitcoin would finally break free from its historical four-year market cycle. Six months later, the firm is walking that call back, and Bitcoin’s price is not helping the case.
A Prediction That Has Not Played Out
In its latest State of the Market report published Wednesday, 21Shares acknowledged the obvious: Bitcoin’s price action has continued following the familiar playbook the firm had hoped would be retired.
“Heading into 2026, we believed that Bitcoin’s four-year cycle could be finished,” the firm wrote. “Six months in, we have to be honest: price action still looks familiar.”
Bitcoin was changing hands at $59,781 on Wednesday, having fallen 52% from its all-time high of $126,080. The drop marks the second time this month BTC has slipped below the $60,000 level.
The Cycle Bent, Not Broke
Despite the admission, 21Shares argued its broader thesis is not entirely wrong. The firm pointed to structural shifts in the market as evidence that the cycle dynamics, while still present, are less severe than in prior periods.
- The current drawdown of roughly 50% is significantly milder than the 80-plus percent bear markets that defined previous Bitcoin cycles.
- ETF ownership has become increasingly institutional, which the firm says has cushioned the decline.
- Bitcoin is holding above its on-chain cost basis of $54,000, according to data from Glassnode, meaning the market has not yet reached what the firm calls “outright capitulation.”
“Market structure has clearly changed: ETF ownership is increasingly institutional and the current drawdown of roughly 50% remains far milder than the 80%+ bear markets of prior cycles,” 21Shares wrote.
ETF Inflows Have Also Disappointed
Beyond the cycle prediction, the firm had forecast that crypto ETFs would push toward $400 billion in assets under management in 2026. That target is far from sight. According to data from CoinGlass, nearly $3 billion in assets left crypto ETFs during the last quarter alone, and crypto ETFs as a whole are down nearly $5 billion since January 1.
More assets have actually exited crypto ETFs than entered them so far this year, contributing to Bitcoin and Ethereum both falling well below their all-time highs.
Other Forecasts Also Falling Short
A cluster of additional 21Shares predictions for 2026 have not materialized either. The firm’s targets of a $1 trillion stablecoin market cap, $300 billion in DeFi total value locked, and $250 billion in assets under management for crypto treasury firms, or DATs, all remain out of reach. 21Shares cited lingering regulatory uncertainty, consistent DeFi exploits, and declining crypto prices as the primary headwinds against those targets.
One Prediction Still on Track
Not everything has missed. 21Shares flagged prediction market trading volumes as the one forecast holding up. The firm had projected the sector would breach $100 billion in volume during 2026. By the end of May, platforms led by Polymarket and Kalshi had already recorded more than $57.5 billion in combined volume, putting the annual target well within reach.
Disclaimer: Decrypt’s parent company Dastan operates the prediction market platform Myriad.
