Gold near previous high, Bitcoin undergoes deep correction: Grayscale predicts a new high in the first half of 2026

Recently, the traditional safe-haven asset gold and digital asset Bitcoin have shown a rare and extreme divergence. Gold prices have risen to $4,305 per ounce, just a step away from the all-time high, with a year-to-date increase of 64%; meanwhile, Bitcoin has hovered around $86,000, retracing about 30% from its October peak. Renowned asset management firm Grayscale, in its latest “Digital Asset Outlook 2026,” interprets the current market as a “pain point” in the “institutionalization era,” and predicts that Bitcoin will hit a new all-time high in the first half of 2026. This judgment is based on structural shifts such as global debt expansion, clearer regulatory frameworks, and continuous institutional capital inflows.

Market Extremes: Safe-Haven Gold Soars vs. Risky Bitcoin Deeply Corrects

The current performance of financial assets clearly outlines investors’ shifting preferences under macroeconomic uncertainty. The strong rally in gold is a classic “safe-haven narrative.” Approaching its historical high, with over 60% gains this year, gold has become one of the most prominent mainstream assets of 2025. The core driver of this bull market is the market’s strong expectation of a Federal Reserve rate cut cycle and ongoing, sizable purchases by global central banks. Data from the World Gold Council shows that, except for May, gold ETF holdings have increased every month this year, directly confirming that institutional and individual investors view gold as a key tool against currency devaluation and inflation risks.

In stark contrast to gold’s hot performance, Bitcoin has recently been weak. After falling from its October high of 126,210 USD, Bitcoin’s price performance is more akin to traditional risk assets like Nasdaq tech stocks, rather than the “digital gold” its advocates claim. On Monday, a sharp market fluctuation liquidated $200 million worth of long positions within an hour, highlighting the fragility of leveraged funds in a declining market. This divergence has caused the Bitcoin-to-gold price ratio to fall into a notable historical range, sparking widespread discussion about “capital rotation” in the market.

This extreme divergence is not accidental; it reflects different capital attributes making different choices in the current macro environment. Amid government shutdowns, missing economic data, geopolitical tensions, and expectations of rate cuts, traditional funds instinctively flock to the long-established “safe harbor” gold. Meanwhile, the crypto market is still digesting previous gains, dealing with internal leverage unwinding, and waiting for clearer macro signals. Grayscale’s report points out that this volatility is a typical feature of the market transitioning from retail-driven to institutional-led.

Grayscale 2026 Outlook: Painting a New Narrative of Bitcoin’s “Institutionalization Era”

In a market with prices on edge, Grayscale’s report provides a strategically high-level roadmap. The firm explicitly states that the market’s inherent narrative of Bitcoin’s four-year cycle is being broken, replaced by an era driven by structural demand and institutional adoption. The core forecast is that Bitcoin will reach a new all-time high in the first half of 2026, not based on simple halving hype, but on deeper financial system evolution.

The primary pillar supporting this optimistic outlook is the global fiscal and monetary backdrop. The report believes that the ongoing expansion of government debt and concerns over long-term erosion of fiat currency purchasing power are systematically increasing Bitcoin’s value as a “digital scarce asset”. Especially as Bitcoin’s inflation rate (annual issuance) has fallen below 1%, and when the 20 millionth Bitcoin is expected to be mined around March 2026, its transparent, immutable supply cap becomes increasingly attractive to long-term value-seeking institutional investors.

Another key pillar is clarification of the regulatory landscape. Grayscale notes that, despite enforcement actions by US regulators in recent years, the tide is turning. The approval of Bitcoin spot ETFs in 2024 and the passage of the GENIUS Act in 2025 pave the way for more comprehensive crypto market legislation in 2026. A clear, sustainable regulatory framework is an absolute prerequisite for traditional large-scale capital to confidently enter. The report cites data indicating that since the launch of US Bitcoin ETFs, global crypto ETPs have absorbed about $87 billion in net inflows, while the proportion of crypto assets within US managed assets remains less than 0.5%, leaving significant room for growth.

Grayscale 2026 Top 10 Themes and Market Impact

Macro and Store of Value:

• Fiat Devaluation: Ongoing global debt issues elevate the strategic value of scarce assets.
• Regulatory Clarity: Bipartisan US legislation is expected to bring certainty, attracting traditional capital.
• Stablecoin Expansion: Under the GENIUS Act framework, compliant stablecoins will see broader adoption.

Technology and Application Expansion:

• Asset Tokenization: Accelerated on-chain processes for traditional financial assets (e.g., government bonds, private equity).
• AI and Blockchain Integration: Combining decentralized computing power, data verification, and AI model training.
• Privacy-Enhancing Tools: Growing demand and technological development for transaction privacy within compliant frameworks.

Market Infrastructure:

• DeFi Lending Evolution: More efficient, risk-parameterized on-chain lending markets.
• Next-Generation Infrastructure: Underlying protocols focused on scalability, security, and interoperability.
• Default Staking Mechanisms: Staking may become a standard feature for custody and asset management in proof-of-stake networks.
• Practical Tokens: Tokens with clear use cases, measurable revenue, and compliant listing channels will be favored.

Key Technical Signals and Capital Rotation Hypotheses

While Grayscale sketches a macro future blueprint, on-chain analysts seek micro signals from data indicating imminent market turning points. One of the most watched technical indicators is the Bitcoin-to-Gold Relative Strength Index (RSI). Noted trader Michaël van de Poppe points out that this indicator has fallen below 30, a rare occurrence in Bitcoin’s history—only the fourth time. Historically, such oversold conditions have marked important market bottoms, often followed by significant Bitcoin strength relative to gold.

Another approach involves observing Bitcoin/Gold price testing long-term upward trendlines. Technical analyst misterrcrypto notes that the current price is testing the long-term support line established since 2019, a fourth such test. Meanwhile, the Z-Score has dropped to -1.76, also in deep oversold territory. After previous tests of this support, strong rebounds followed. These technical signals jointly suggest that, from a risk-reward perspective, Bitcoin may currently have a higher allocation value relative to gold.

Of course, charts alone cannot determine the future. Whether a “capital rotation” occurs depends on macro catalysts. The market is closely watching the Federal Reserve’s future path. Despite persistent inflation, three rate cuts in 2025 and market expectations of continued easing into 2026 create potential tailwinds for risk assets. Grayscale specifically notes that, historically, Bitcoin’s two previous bull market peaks occurred during Fed rate hike cycles, and this cycle may be accompanied by rate cuts, providing an unprecedented liquidity environment.

Macro Uncertainty and Regulatory Dawn: Two Forces Shaping the Future

At this crossroads, the market’s outlook is shaped by two main forces: the uncertain macro economy and the increasingly clear industry regulation. Recent six-week US government shutdown caused a lack of key economic data, casting a shadow over the true state of the economy. The latest employment report shows a modest slowdown in the labor market, but details are limited. This “data fog” may instead reinforce expectations that the Fed will maintain or deepen easing, supporting asset prices including Bitcoin.

On the regulatory front, a more positive trend is emerging. Grayscale’s report lists “regulatory clarity” as its second major theme, expecting 2026 to be a decisive year for US crypto legislation. Moving from enforcement-based regulation to a framework based on clear legislation signals a new phase of “compliance-driven growth.” This will unlock more institutional participation and promote innovation in asset tokenization, compliant DeFi, and other areas, broadening the fundamental utility and value capture of cryptocurrencies.

Overall, gold’s strength prices in the past and current risks, while Grayscale’s optimistic outlook for Bitcoin reflects a view of future structural trends. Short-term market sentiment may still fluctuate between the two, but long-term capital is increasingly positioning based on the latter. As the report states, topics like quantum computing threats and corporate sell-offs are noise; the market’s core themes have shifted to institutional adoption, macro hedging, and stable traditional portfolio inflows.

The divergence between gold and Bitcoin is less a contest of the “digital gold” narrative’s victory or defeat, and more a reflection of different capital strategies across time horizons. Gold shines with current safe-haven appeal, while Bitcoin is accumulating for the next financial era. Grayscale’s report clearly indicates that the market’s driving logic is undergoing a fundamental shift: from reliance on discrete halving events and retail frenzy to a foundation built on global debt crises, institutional asset allocation, and improved regulatory frameworks. For investors, perhaps the key is not asking “When will Bitcoin catch up with gold again,” but understanding that, within this “institutionalization era” outlined by Grayscale, Bitcoin’s positioning, investor structure, and price drivers are fundamentally different from past cycles. The arrival of new all-time highs will no longer be a simple repetition of cycles, but an inevitable milestone in the slow shift of the financial paradigm.