The Aftermath of the Crypto Market: Summary of Major News from December 2025 to January 2026

As time progresses, the cryptocurrency market is entering a new phase. We have summarized the industry trends emerging from recent weeks’ news. The developments from last month to now suggest that the relationships among institutional investors, regulators, and the protocols themselves are undergoing dramatic changes.

Bitcoin Price Outlook: Forecasting a New High in 2026

Analysis from the major US asset management firm Bitwise indicates a high likelihood that Bitcoin will surpass its all-time high in 2026. Subsequent reports have also reinforced this outlook.

According to Chief Investment Officer Matt Hogan, while the effects of the halving cycle are diminishing, factors such as expected interest rate declines, reduced leverage risks, expansion of spot ETFs, and increased regulatory transparency are predicted to accelerate capital inflows from institutional investors. The interplay of these factors could enable Bitcoin to break through its traditional four-year cycle and reach new milestones.

Interestingly, Bitcoin’s volatility characteristics are also changing. Since early 2025, Bitcoin’s volatility has fallen below that of NVIDIA stock, and this trend is expected to continue in the medium term. This will significantly revise the traditional view of Bitcoin as a “high-risk asset.”

Accelerating Institutional Money Inflows: Year-End Rebalancing Effects

According to Vetle Lunde, head of research at K33, Bitcoin’s performance in Q4 has lagged the stock market by up to 26%. While this may seem negative at first glance, the subsequent developments tell a different story.

During the year-end to early January period, when asset managers are rebalancing their portfolios, large-scale capital inflows into relatively undervalued Bitcoin are expected. Fund managers who have already set allocation targets and operators needing to adjust positions by year-end are entering a period of significant buying.

Looking at market activity, CME derivatives are trading near their annual lows, with open interest in Bitcoin futures around 124,000 contracts. Funding rates for perpetual futures are nearly neutral, indicating that investment sentiment toward new risk assets remains cautious.

Stablecoin Regulations Enter a New Stage: Establishing a Global Framework

Bank of Canada Governor Tiff Macklem clarified that only high-quality stablecoins pegged 1:1 to central bank digital currencies (CBDCs) will be approved under the upcoming 2026 stablecoin regulations. Several other countries are showing similar tendencies.

He stated, “We expect stablecoins to become a form of premium money comparable to banknotes and bank deposits,” emphasizing a strict 1:1 peg requirement. It is anticipated that these will be fully backed by high-quality liquid assets such as government bonds and Treasury securities.

Meanwhile, in the US, the FDIC has released proposed rules for the implementation of the GENIUS Act. Regulations for applications by subsidiaries issuing settlement stablecoins are expected to be approved within the year, followed by detailed requirements on capital, liquidity, and risk management within a few months. This framework will mark a significant turning point in positioning stablecoins as legitimate financial instruments.

Reorganization of DeFi Protocols: Challenges Highlighted by Aave Governance Dispute

A major decentralized finance (DeFi) protocol, Aave, has revealed fundamental conflicts within DAO governance. Some token holders have proposed a “poison pill” strategy, asserting that DAO should take full control of Aave Labs’ intellectual property and equity.

This development could influence governance structures across the industry. The relationship between DAO communities and project companies, especially regarding revenue sharing, highlights critical challenges faced by the DeFi sector.

Good news: the US Securities and Exchange Commission (SEC) announced the conclusion of its four-year investigation into the Aave protocol. Founder Stani.eth stated that this decision reduces regulatory uncertainty for the entire DeFi sector and creates an environment where developers can focus on innovation.

Wall Street Democratizes Bitcoin Investment: Surge in Structured Bonds

According to a Bloomberg report, major Wall Street banks are rapidly developing investment products related to Bitcoin. Once considered a volatile and insufficiently regulated asset, Bitcoin is now targeted by complex financial products for institutional investors.

Since Jefferies Financial Group issued the first US structured bond linked to BlackRock’s Bitcoin ETF (IBIT) in July, major banks like Goldman Sachs, Morgan Stanley, and JPMorgan Chase have followed suit. Within just a few months, these banks have sold structured bonds exceeding $530 million.

This approach offers investors with varying risk tolerances tailored returns and partial downside protection. The movement of Wall Street integrating Bitcoin into standard investment portfolios signals a maturing asset class.

Pursuit of Trump-Related Projects: Senator Warren’s Regulatory Oversight

Senator Elizabeth Warren has requested the Treasury Secretary and Attorney General to investigate national security concerns related to the decentralized exchange PancakeSwap. The subsequent concerns involve the platform’s use for manipulating the value of tokens issued by World Liberty Financial (WLFI).

Warren argues that PancakeSwap, functioning as a major protocol on Binance Chain across multiple blockchains, should be scrutinized for potential undue political influence from the Trump administration’s law enforcement agencies. This marks an emerging phase of political involvement in crypto regulation.

Wallet Ecosystem Restructuring: Shock of Blocto Service Closure

Multi-chain wallet Blocto announced the termination of its wallet services after five years of operation. In 2023, it raised $80 million in Series A funding, with a valuation of $800 million, and was backed by investors including Mark Cuban.

Subsequently, the company faced tough conditions, with the FLOW token dropping over 99% from its 2021 peak, accumulating losses exceeding $5.5 million over five years. Blocto Wallet, BloctoSwap, and Blocto Teleport are scheduled to officially shut down on December 18, 2025, with users being instructed to withdraw liquidity assets and export private keys. Staking services are expected to continue.

Turning Point in Digital Asset Regulation: Resumption of China’s Lingxi

JD.com’s digital collectibles platform “Lingxi” announced the launch of a transfer function, signaling a major shift in China’s digital art industry regulatory environment. Subsequent policy standards are moving the industry from “voluntary exploration” to “standardized guidance.”

Effective December 2025, the “Cultural Digital Asset Trading Management Implementation Guidelines” and “Cultural Digital Asset Valuation Guidelines” will be officially enforced, unifying participant qualifications, risk management, and valuation systems. Lingxi’s revival will demonstrate that digital collectibles are not financial assets but digital rights certificates representing goods.

Emerging Markets’ Digital Finance: Marshall Islands and Olea

The Republic of the Marshall Islands has implemented the world’s first blockchain-based universal basic income (UBI) program on the Stellar blockchain. The digital native government bond USDM1 is a fully backed program worth several million dollars, linked to short-term US Treasury securities.

This move replaces traditional quarterly physical distributions with digital transfers, benefiting recipients across the islands. Additionally, Singapore-based digital trade platform Olea completed a Series A funding round of $30 million from BBVA, XDC Network, Standard Chartered Bank subsidiaries, and others.

Olea has since obtained a CMS license from the Monetary Authority of Singapore and has provided over $3 billion to more than 1,000 companies, accelerating digital finance penetration in Asia’s emerging markets.

Surge in Product Offerings on Exchange Platforms

Coinbase is launching multiple new perpetual and spot trading products. These include Merlin Chain (MERL) perpetual futures, Theoriq (THQ), and Beam (BEAM) spot trading, many of which became available from December 18, 2025.

CME Group has also introduced support for TAS (Trade at Settlement) trading in SOL, microSOL, XRP, and microXRP futures. This trading mode allows buying and selling near the closing price of the day, enabling precise hedging of settlement risks.

Furthermore, industry developments include Vermouth Wallet’s Rainbow Wallet planning to conduct a RNBW token TGE on February 5, 2026. The community presale via CoinList will account for 3% of total supply, with an estimated market cap of $100 million, offered at a 50% discount from previous funding valuation.

Regulatory Agencies’ Industry Frameworks

The CFTC is soliciting comments on the presidential working group’s report on digital assets, with Andreessen Horowitz (a16z) proposing three action plans: clarifying that protocols meeting certain criteria are exempt from registration, confirming exemption for apps meeting specific functional requirements, and developing innovative or customized registration pathways.

The UK’s Financial Conduct Authority (FCA) has published new regulatory proposals aimed at promoting reliable, sustainable, and competitive crypto markets, inviting public comments until February 12, 2026. Key areas include asset issuance and disclosure, market manipulation prevention, trading platform regulation, intermediary responsibilities, staking and lending protections, DeFi regulation scope, and systemic soundness requirements.

Geopolitical Risks and Warnings

Anatoly Aksakov, chairman of the Russian State Duma Committee on Financial Markets, reaffirmed that cryptocurrencies will never become currency in Russia and will only be used as investment tools. The ongoing conflict between the Bank of Russia’s full ban demands and the Ministry of Finance’s support for regulation and taxation continues, with a four-year deadlock persisting in the Duma committee.

The People’s Bank of China Shanghai branch issued warnings about scams under the guise of promoting the digital yuan, cautioning citizens against high-yield schemes and multi-level marketing involving membership recruitment.

Macroeconomics and Market Sentiment

US employment data shows that non-farm payrolls increased by 64,000 in November, with the unemployment rate reaching 4.6%. This slightly underperforms market expectations and has a modest impact on interest rate cut prospects. The subsequent interest rate futures market anticipates two rate cuts in 2026, with an expected easing of 58 basis points.

Large Capital Movements and Market Dynamics

Significant capital transfers have been reported. BlackRock transferred 47,463 ETH (approximately $140 million at current prices) to Coinbase, with a newly created wallet receiving 48,049 ETH (about $141.78 million) from FalconX, indicating important signals of institutional fund shuffling.

Meanwhile, trader Huang Licheng returned after liquidation, depositing 1.2 million USDC into Hyperliquid and opening a new 25x leveraged long position in ETH. Retail traders are also repositioning.

New Capital Market Entries and Lending Trends

Stablecoin payment platform RedotPay raised $100.7 million in Series B funding led by Goodwater Capital. Participants include Pantera Capital, Circle Ventures, Blockchain Capital, and existing investor HSG. The funds will support growth of a platform with $10 billion in annual transaction volume, $150 million annual revenue, and 6 million registered users.

As part of expanding payment infrastructure, Visa has launched USDC payment services via the Solana blockchain in the US. Initial users include Cross River Bank and Lead Bank, marking the first full-scale deployment of Visa’s stablecoin payments within the US banking system.

Industry Personnel and Judicial Movements

Former Alameda CEO Caroline Ellison, after nearly 11 months in custody, was transferred on October 16 from a federal prison in Connecticut to a “community confinement” environment. Her original two-year sentence was significantly shortened, with an expected release date of February 20, 2026. The aftermath of the FTX collapse continues to impact the industry.

Meanwhile, founder and chairman of 360 Group Zhou Hongyi issued a strong statement denying allegations of financial fraud by Yu Hong. He stated Yu Hong was a former executive at Gamewave, resigned in 2015, and that claims of “financial fraud” are “completely false,” warning of legal action.

New Options for Market Participants

Gemini Exchange has made its prediction market product “Gemini Predictions” available in all 50 US states. It allows trading based on real-world event outcomes, offering near-instant execution and full transparency. Currently, it is offered fee-free.

Coinbase has added multiple spot and perpetual trading features on the platform, greatly expanding user trading options.

Tokenomics and Market Structure

Rainbow’s tokenomics has been published: out of a total supply of 1 billion RNBW tokens, 15% will be a TGE airdrop, about 3% for community presale, 47% for treasury, 12.2% for the team, 7.8% for investors, and 15% for the community. The initial circulating supply at TGE is expected to be around 20% (including airdrop and presale).

Meanwhile, analysis of $PIPPIN tokens shows that insiders hold about 80% of the supply (equivalent to $380 million). Follow-up investigations reveal that 16 new wallets funded by HTX show similar patterns, and 11 wallet groups related to Bitget hold about 9% of the supply.

Summary and Outlook: Key Points to Watch

In summary, recent developments indicate that the crypto industry is at multiple turning points. Regulatory frameworks are rapidly evolving, institutional participation is accelerating, and Wall Street is focusing on developing new financial products. Growth is observed simultaneously across segments such as stablecoins, DeFi, digital payments, and prediction markets.

Risks include geopolitical conflicts, governance disputes within projects, and cautious investment attitudes among market participants. However, increased regulatory transparency, industry cleanup after corporate failures, and new foundational infrastructure are fostering a more sustainable and transparent market environment.

The future trajectory of the market will largely depend on Bitcoin price movements in early 2026, the implementation of FED interest rate policies, the resolution of DeFi governance issues, and the progress of stablecoin regulation implementation.