CoinRank

CoinRank is recruiting independent writers worldwide 💥

What we’re looking for:
→ Deep research & trend analysis
→ Data-driven or on-chain insights
→ Web3 / Crypto / Market narratives
→ English content (self-pitched or guided topics)

What you get:
Global exposure via CoinRank website & media network
Promotion on Twitter, Telegram & partner channels
Official CoinRank contributor identity
Featured articles & social shoutouts
Dedicated author profile with your links

If you want your writing seen by real crypto readers, this is for you.
Apply now: https://forms.gle/j2U7zait2gWQdEAo7

#CoinRank #CryptoWriters #Web3Content #WriteToEarn

#Trump claims to have captured Maduro and taken him out of Venezuela; he previously championed the "Petro" cryptocurrency to counter US sanctions.

#Ethereum treasury company Quantum Solutions discloses ETH holdings have increased to approximately 5,418.

#Bitmine further increases staking, causing a surge in ETH holdings in the validation queue, extending the waiting period to 17 days.

#Helium founder: Due to lukewarm market response, HNT token buybacks will be halted.

Robinhood will release its full-year 2025 earnings report on February 10th.

#CoinRank

⏰2025/12/29 - 2026/1/4 | This Week's Top Events: What Did You Miss?

Market Weekend Recap
Here's a quick look at the key headlines from this weekend👇

#CoinRank #CryptoNews #CryptoMarket #CryptoTrading

#Bitfinex hack participant Ilya Lichtenstein to be released early

#Glassnode : Current market structure exhibits typical characteristics of a long-term bear market

#Infinex founder pays $50,000 to Multicoin co-founder after losing a bet on ETH price

10x Research: Crypto market is shifting from defense to opportunity; the next phase favors discipline and active position management

#Tether invests in cross-border QR code payment platform SQRIL;

#CoinRank

Bitcoin exposure has driven MSTR’s derivatives open interest to extreme levels, signaling heavy leverage speculation around MicroStrategy stock.

 

Despite the hype, MSTR shares are down about 50% in 2025, far underperforming Bitcoin, with mNAV compressing toward parity.

 

Rising STRC dividends and potential MSCI index exclusion add financial and structural risks for MicroStrategy investors.

Michael Saylor says Bitcoin made MicroStrategy (MSTR) interesting as derivatives open interest soars, mNAV compresses, dividends rise, and MSCI index risks loom.

 

MicroStrategy founder Michael Saylor, a pioneer of the Bitcoin treasury strategy, recently pointed out that MSTR’s open interest notional value far exceeds that of other tech giants, arguing that Bitcoin is what made MSTR “interesting.”

 

However, MSTR shares have fallen about 50% so far in 2025—significantly underperforming Bitcoin’s roughly 6% decline—prompting some observers to question whether the stock’s weakness is largely the result of heavy short selling.

 

OPEN INTEREST SURGES: HAS BITCOIN-DRIVEN LEVERAGE SPECULATION MADE MSTR “INTERESTING”?

 

Michael Saylor compared MSTR’s open interest notional value with that of other major tech stocks, arguing that Bitcoin is what made MSTR interesting. According to the chart, MSTR’s ratio of derivatives open interest to market capitalization stands at 86%—far above Tesla’s 22% and Microsoft’s 3%. In Saylor’s view, Bitcoin integration has significantly increased the stock’s appeal to traders seeking leveraged exposure to Bitcoin.

 

In equity markets, a stock’s “open interest” (OI) typically refers to the total number of outstanding derivatives contracts—such as options or futures—linked to that stock. Comparing the notional value of these derivatives’ open interest with the company’s market capitalization serves as a proxy for the degree of leverage speculation and the influence of the derivatives market on the stock’s price. When this ratio becomes excessively high, it suggests that a large amount of speculative capital is actively betting on the stock.

WEAK SHARE PRICE PROMPTS ANOTHER DIVIDEND HIKE ON STRC TO 11%

 

MicroStrategy also announced that it has raised the dividend rate on its perpetual preferred stock STRC to 11%. Because the company originally targeted a trading range of 99–101 for STRC, increasing the dividend yield has become the primary tool to support the stock price. This marks the second dividend increase since STRC was issued in July last year.

 

>>> More to read: Who is Michael Saylor? Founder of MicroStrategy

MNAV PREMIUM COMPRESSION AND POTENTIAL MSCI INDEX ADJUSTMENT RISKS

 

MSTR has fallen about 50% so far in 2025, significantly underperforming Bitcoin’s roughly 6% decline. As a result, its mNAV—the ratio between the current share price and the value of the Bitcoin it holds—has compressed toward parity, approaching a level of 1.

 

The market is now awaiting a decision from global index provider MSCI on January 15 regarding whether Strategy and other DAT companies could be removed from its indices, a move that could introduce additional downside risk.

 

>>> More to read: What is MicroStrategy (MSTR)? From Data to Digital Gold

 

 

 

 

ꚰ CoinRank x Bitget – Sign up & Trade!

Looking for the latest scoop and cool insights from CoinRank? Hit up our Twitter and stay in the loop with all our fresh stories!

〈Saylor Says Bitcoin Made MicroStrategy Interesting〉這篇文章最早發佈於《CoinRank》。

Proof of Burn (POB) secures blockchain networks by requiring participants to destroy tokens as an irreversible economic commitment.

 

By replacing hardware and electricity with token burning, Proof of Burn (POB) aims to reduce energy consumption while preserving incentive alignment.

 

Despite its potential benefits, Proof of Burn (POB) remains debated, with open questions around scalability, transparency, and real-world adoption.

Proof of Burn (POB) is a blockchain consensus mechanism that secures networks by permanently burning tokens, replacing energy-intensive mining with economic commitment.

 

 

WHAT IS PROOF OF BURN (POB)?

 

Proof of Burn (POB) is a blockchain consensus concept that exists in several variations, but the version most widely recognized in the crypto industry was proposed by Iain Stewart. It was introduced as a more sustainable alternative to traditional consensus models, particularly as a way to rethink how long-term network commitment can be established without relying on heavy resource consumption.

 

At a conceptual level, Proof of Burn (POB) can be viewed as a lower-energy counterpart to Proof of Work. Instead of requiring miners to compete through raw computational power or specialized hardware such as ASICs, PoB replaces physical resource expenditure with intentional economic sacrifice. In this model, cryptocurrencies are deliberately destroyed—or “burned”—as a form of investment into the blockchain network.

 

Under a Proof of Burn (POB) system, miners do not invest in hardware or electricity. Instead, they allocate capital to what can be described as a virtual mining platform, where burned tokens represent virtual mining power. This design removes the need for continuous energy consumption while preserving a cost-based mechanism for participation.

 

In practical terms, burning tokens allows participants to demonstrate their long-term commitment to the network and earn the right to validate transactions and produce blocks. The act of burning coins functions as a proxy for mining power: the more tokens a participant destroys, the greater their virtual hash power within the system.

 

As a result, in a Proof of Burn (POB) consensus model, users who burn larger amounts of cryptocurrency gain a higher probability of being selected as the next block validator. This approach shifts competition away from physical resources and toward economic commitment, forming the core logic behind the PoB consensus mechanism.

 

>>> More to read: What is Proof of Stake (PoS)?

HOW DOES PROOF OF BURN WORK?

 

At a basic level, Proof of Burn (POB) works by permanently removing tokens from circulation. This is done by sending coins to a publicly verifiable address where they can no longer be accessed, owned, or spent. In most cases, these burn addresses are randomly generated addresses with no known private key, ensuring that the burned coins are effectively lost forever.

 

From a market perspective, burning tokens reduces circulating supply and introduces scarcity, which may contribute to potential value appreciation over time. However, in the context of Proof of Burn (POB), scarcity is not the primary objective. More importantly, token burning functions as an alternative form of investment used to help secure the blockchain network.

 

One of the reasons Proof of Work blockchains are considered secure is that miners must commit substantial real-world resources before they can earn rewards. This upfront cost—whether in electricity, hardware, or operational expenses—creates a strong incentive for miners to act honestly, since malicious behavior would risk wasting their initial investment.

 

Proof of Burn (POB) follows a similar incentive logic, but replaces physical resource consumption with economic sacrifice. Instead of investing electricity, labor, or computational power, participants secure the network by burning coins. The burned tokens themselves represent the cost of participation and the miner’s commitment to the system.

 

Like Proof of Work blockchains, Proof of Burn (POB) systems reward miners with block rewards. Over time, these rewards are expected to compensate for the initial cost of burned coins, aligning long-term incentives between network security and participant profitability.

 

As mentioned earlier, there are multiple ways to implement Proof of Burn (POB). Some projects require participants to burn Bitcoin in order to gain mining or validation rights, while others achieve consensus by burning their own native cryptocurrencies. Despite these variations, the underlying principle remains the same: long-term network security is enforced through irreversible economic commitment rather than ongoing physical resource expenditure.

 

>>> More to read: What is Proof of Work (PoW)?

PROS AND CONS OF PROOF OF BURN

 

The advantages and disadvantages outlined below are based on commonly cited arguments from supporters of Proof of Burn (POB). They should not be treated as established facts. Many of these claims remain debated within the crypto community and require further testing and real-world validation before they can be confirmed or dismissed.

 

✅ Advantages

 

One of the most frequently mentioned benefits of Proof of Burn (POB) is sustainability. Because the mechanism does not rely on continuous computational work, it is often described as more energy-efficient compared to traditional mining-based systems.

 

Another advantage is that Proof of Burn (POB) eliminates the need for specialized mining hardware. Instead of physical machines, token burning acts as a form of virtual mining power, lowering the barrier to participation.

 

Burning cryptocurrency also reduces circulating supply, introducing scarcity into the market. While this is not the primary goal of Proof of Burn (POB), it is often cited as a secondary economic effect.

 

Supporters further argue that Proof of Burn (POB) encourages long-term commitment from miners. Because burned tokens cannot be recovered, participants are incentivized to behave honestly and remain engaged with the network over time.

 

Finally, some proponents believe that Proof of Burn (POB) can lead to a more decentralized distribution of mining or validation power, as participation is not dominated by access to industrial-scale hardware or cheap electricity.

❗Disadvantages

 

Critics argue that Proof of Burn (POB) is not truly environmentally friendly. In cases where Bitcoin is burned, those coins were originally produced through Proof of Work mining, which already consumed significant energy and resources.

 

Another concern is scalability. There is currently no conclusive evidence that Proof of Burn (POB) can operate efficiently or securely at the scale of large blockchain networks. More testing and real-world deployment are needed to evaluate its long-term viability.

 

Verification delays are also cited as a drawback. Compared to Proof of Work systems, validation and confirmation of miner activity in Proof of Burn (POB) networks may take longer, reducing responsiveness.

 

Lastly, the token-burning process itself is not always fully transparent or easily verifiable by average users. In some implementations, it may be difficult for non-technical participants to independently confirm that coins have truly been burned.

 

 

 

 

ꚰ CoinRank x Bitget – Sign up & Trade!

Looking for the latest scoop and cool insights from CoinRank? Hit up our Twitter and stay in the loop with all our fresh stories!

〈What is Proof of Burn (PoB)?〉這篇文章最早發佈於《CoinRank》。

Blockchain bridges connect isolated networks, enabling cross-chain asset transfers and true interoperability.

 

By leveraging wrapped assets and sidechains, blockchain bridges improve scalability and reduce transaction costs.

 

Security remains the key challenge, making robust and well-designed blockchain bridges essential for the multi-chain future.

Blockchain bridges enable interoperability between isolated blockchains, allowing assets and data to move across networks while improving scalability, efficiency, and access to cross-chain applications.

 

 

WHY DO WE NEED A BLOCKCHAIN BRIDGE?

 

As the blockchain ecosystem continues to expand, one fundamental limitation has become increasingly clear: most blockchains cannot natively work with one another. Each blockchain operates under its own rules, tokens, protocols, and smart contract frameworks, creating isolated environments across the crypto landscape.

 

A Blockchain Bridge exists to break down these barriers. By connecting otherwise separate blockchains, a Blockchain Bridge allows assets and data to move between independent networks, transforming fragmented ecosystems into a more unified and interconnected blockchain network. When blockchains can interact seamlessly, token transfers become more efficient and the overall flow of value improves across the ecosystem.

 

Beyond enabling cross-chain transfers, a Blockchain Bridge delivers additional benefits. It allows users to access new protocols and applications on other blockchains without being confined to a single network. At the same time, it enables developers from different blockchain communities to collaborate more easily, fostering innovation across ecosystems.

 

In this sense, a Blockchain Bridge is not just a technical tool—it is a foundational component for the future of blockchain interoperability. As the industry moves toward a more connected and cooperative multi-chain environment, Blockchain Bridges will play a critical role in shaping how decentralized networks evolve and scale.

 

>>> More to read: What is Blockchain and How Does It Work?

HOW DOES A BLOCKCHAIN BRIDGE WORK?

 

The most common use case of a Blockchain Bridge is token transfer across different blockchains. For example, imagine you want to move your Bitcoin (BTC) onto the Ethereum network. One straightforward option would be to sell your BTC and purchase Ether (ETH). However, this approach involves transaction fees and exposes you to price volatility during the conversion process.

 

A Blockchain Bridge offers an alternative way to achieve the same goal—without selling your cryptocurrency. When you bridge 1 BTC to an Ethereum wallet, the Blockchain Bridge smart contract locks your BTC on its original network. At the same time, an equivalent amount of Wrapped Bitcoin (WBTC) is created on Ethereum. WBTC is an ERC-20 token designed to be fully compatible with the Ethereum ecosystem.

 

In this process, the original BTC remains locked inside a smart contract, while a corresponding token is issued or minted on the destination blockchain. This wrapped token represents the value of the original asset and can be used within the target network just like any other native token.

 

Wrapped tokens are essentially tokenized versions of another cryptocurrency. Their value is pegged to the underlying asset they represent, and in most cases, they can be redeemed—or “unwrapped”—at any time by reversing the bridging process. Through this mechanism, a Blockchain Bridge enables assets to move across blockchains while preserving ownership and value.

 

>>> More to read: What is Wrapped Bitcoin (WBTC)?

WHAT TYPES OF BLOCKCHAIN BRIDGES EXIST?

 

There are several ways to classify a Blockchain Bridge, depending on its trust model, functionality, and operational mechanism. Each category reflects different design trade-offs in security, decentralization, and usability.

 

✅ Custodial vs. Non-Custodial Blockchain Bridges

 

One of the most common classifications divides a Blockchain Bridge into two categories: custodial (centralized) and non-custodial (decentralized).

 

A custodial Blockchain Bridge requires users to trust a central entity to operate the bridge securely and manage locked assets properly. In this model, the bridge operator controls the system, which means users must place confidence in the organization’s operational integrity and security practices. As a result, thorough due diligence is essential before using a custodial bridge.

 

In contrast, a non-custodial Blockchain Bridge operates in a decentralized manner. It relies on smart contracts to manage the locking and minting of assets, removing the need to trust a centralized bridge operator. Instead of human oversight, security depends entirely on the correctness and robustness of the underlying code. In this setup, trust is shifted from institutions to software.

✅ Blockchain Bridges by Function

 

Another way to categorize a Blockchain Bridge is based on its primary function, such as wrapped-asset bridges and sidechain bridges.

 

Wrapped-asset bridges enable interoperability by tokenizing cryptocurrencies from one blockchain for use on another. A common example is converting Bitcoin into Wrapped Bitcoin (WBTC), an ERC-20 token compatible with the Ethereum network. Through this process, Bitcoin can be effectively transferred and utilized within Ethereum-based applications.

 

Sidechain bridges, on the other hand, connect a main blockchain to its sidechain, allowing assets and data to move between the two. This interoperability is necessary because a main chain and its sidechain often operate under different consensus mechanisms. One example is the xDai bridge, which connects the Ethereum mainnet to the Gnosis Chain (formerly the xDai blockchain). Gnosis Chain functions as an Ethereum-based stable payment sidechain secured by its own validator set, distinct from Ethereum’s validators. The xDai Blockchain Bridge enables users to transfer value smoothly between these two networks.

✅ Blockchain Bridges by Transfer Mechanism

 

Blockchain Bridges can also be classified by how assets move across chains: one-way or two-way bridges.

 

A one-way Blockchain Bridge allows users to transfer assets to a destination blockchain without the ability to move them back to the original chain. Once bridged, the assets remain permanently on the target network.

 

A two-way Blockchain Bridge, by contrast, supports bidirectional transfers. Assets can be bridged to another blockchain and later returned to their native chain by reversing the process. This flexibility makes two-way bridges more versatile for users who actively operate across multiple blockchains.

 

>>> More to read: What’s the Difference Between Blockchain and Bitcoin?

BENEFITS OF A BLOCKCHAIN BRIDGE

 

The most important benefit of a Blockchain Bridge is improved interoperability. By enabling assets, tokens, and data to move across different blockchains, a Blockchain Bridge connects otherwise isolated networks into a more cohesive ecosystem. This interoperability applies across Layer 1 and Layer 2 networks, as well as between various sidechains.

 

For example, Wrapped Bitcoin (WBTC) allows Bitcoin holders to access decentralized applications (DApps) and DeFi services within the Ethereum ecosystem. Without a Blockchain Bridge, such cross-ecosystem participation would not be possible. A highly interoperable blockchain environment is widely considered essential for the long-term success and growth of the industry.

 

Another key advantage of a Blockchain Bridge lies in scalability. Some bridges are designed to handle a large volume of transactions more efficiently, helping reduce congestion on major networks.

 

🔍 Key scalability-related benefits include:

 

Supporting asset transfers between high-security but congested networks and faster, lower-cost chains

 

Improving transaction speed and lowering fees for users

 

 

A well-known example is the Ethereum–Polygon Blockchain Bridge, a decentralized two-way bridge that serves as a scalability solution for Ethereum. By moving transactions to Polygon, users can enjoy faster confirmation times and significantly lower transaction costs while still remaining connected to the Ethereum ecosystem.

RISKS OF A BLOCKCHAIN BRIDGE

 

Despite their advantages, Blockchain Bridges also come with notable risks and limitations. Over time, attackers have exploited vulnerabilities in certain Blockchain Bridge smart contracts, leading to large-scale losses of cryptocurrency. In fact, cross-chain bridges have historically been among the most frequent targets for high-profile exploits.

 

One major risk is custodial risk. Custodial Blockchain Bridges require users to trust a centralized entity to safeguard locked assets. In theory, this central operator could misuse or steal user funds. For this reason, users should only consider custodial bridges operated by well-established platforms with a strong and transparent track record.

 

🔍 Additional risks and limitations include:

 

Smart contract vulnerabilities that can be exploited by attackers

 

Transaction throughput bottlenecks that limit large-scale interoperability

 

Dependence on the security assumptions of multiple blockchains

 

While a Blockchain Bridge can help relieve network congestion by moving assets to another chain, it does not fully solve scalability challenges. Users do not always migrate together with the same applications and services. For instance, some Ethereum-based DApps may not be supported on Polygon via a Blockchain Bridge, reducing the practical effectiveness of cross-chain scaling.

 

Finally, Blockchain Bridges can introduce trust fragmentation at the protocol level. Because a Blockchain Bridge connects two distinct blockchains, the overall security of the interconnected system is only as strong as its weakest component. If one network or bridge mechanism is compromised, the risks can propagate across the connected ecosystem.

 

>>> More to read: What is a Cross-chain Bridge & Why We Need It

CONCLUSION

 

The development of the blockchain industry has been driven by continuous innovation. Early pioneer networks such as Bitcoin and Ethereum laid the foundation, followed by the emergence of numerous alternative Layer 1 and Layer 2 blockchains. At the same time, cryptocurrencies—whether used as currencies or tokens—have grown at an exponential pace.

 

Because these blockchains operate under independent rules and technical architectures, Blockchain Bridges are required to connect them. By linking separate networks, a Blockchain Bridge enables a more cohesive and interoperable blockchain ecosystem, opening the door to improved scalability and greater operational efficiency.

 

As cross-chain attacks targeting Blockchain Bridges have occurred repeatedly, the industry continues to pursue safer and more robust Blockchain Bridge designs. Improving security while maintaining interoperability will remain a critical focus as the multi-chain ecosystem continues to evolve.

 

 

 

 

 

 

 

ꚰ CoinRank x Bitget – Sign up & Trade!

Looking for the latest scoop and cool insights from CoinRank? Hit up our Twitter and stay in the loop with all our fresh stories!

〈What is a Blockchain Bridge?〉這篇文章最早發佈於《CoinRank》。

Tom Lee: Gold has seen a parabolic rise over the past year, leading the cryptocurrency market.
More than 40 countries, including the UK, implemented new crypto tax rules on January 1st, requiring exchanges to collect and report user transaction records.
#Coinbase Research Head: Factors driving crypto growth, such as regulation, ETFs, and stablecoins, will become even stronger in the future.
Opinion: Will provide full compensation for the #Metamask market results bias caused by oracle contamination.
#a16z crypto releases 17 industry outlooks for 2026.

#CoinRank #GN

#Binance responds to BROCCOLI714 cryptocurrency volatility: System checks show risk control is normal, no hacker attack detected.
US Congressman: Digital identity and #CBDC could turn the US into a "surveillance nation".
World's largest gold and silver ETFs begin reducing holdings, decreasing by 1.43 tons and 11.28 tons respectively compared to the previous day.
Mike Irving appointed global brand ambassador for ForeGate.
Reserve Bank of India recommends countries prioritize CBDC development over stablecoins.
#CoinRank

Crypto markets are transitioning from halving-driven cycles to macro-driven allocation as ETFs and institutions dominate demand, weakening the traditional four-year boom-and-bust pattern.

 

Pricing power is shifting from retail exchanges to institutional venues like ETFs and regulated derivatives, making crypto increasingly sensitive to macro data and capital flows.

 

Regulatory clarity and on-chain institutional infrastructure could transform crypto into productive, yield-generating capital, accelerating its integration into mainstream financial portfolios.

Bitwise argues crypto is shifting from four-year cycles to macro-driven allocation as ETFs, regulation, and institutions reshape pricing power and market structure.

For years, crypto investors have relied on a familiar rhythm: halving, hype, blow-off top, and collapse. That framework worked when crypto was still a largely self-contained ecosystem, priced mainly by retail flows and leverage on offshore exchanges. The latest annual outlook from Bitwise argues that this era is ending.

 

Compared with the more data-dense, protocol-level approach often associated with Messari, Bitwise writes for a very different audience: wealth advisors, institutional allocators, and fiduciaries who manage billions but remain structurally skeptical of crypto. Its focus is not which token might outperform next quarter, but how crypto assets are being absorbed into the global financial system.

 

Messari’s 2026 Crypto Theses: Power Struggles, Stablecoins, and Skepticism (Part 2)

Messari’s 2026 Crypto Theses: Who Defines the Future—and Who Gets There Too Early (Part 3)

 

That difference in perspective matters. Bitwise’s central claim is that crypto is no longer a “mechanical four-year cycle trade,” but a macro-sensitive allocation driven by ETFs, regulation, and institutional balance sheets. Whether one agrees with all of its conclusions or not, the framework itself deserves close scrutiny.

 

THE END OF THE FOUR-YEAR CYCLE

 

The four-year halving narrative is deeply ingrained in Bitcoin culture. Every 210,000 blocks, issuance drops, miners sell less, supply tightens, and prices eventually rise. Historically, this dynamic helped create self-reinforcing bull markets as participants front-ran the halving and extrapolated prior cycles.

 

Bitwise does not deny this history. Instead, it argues that the mechanism has been overwhelmed. With the approval of spot ETFs, marginal demand is no longer set by miners or retail traders reacting to issuance schedules. It is set by institutions allocating capital on a recurring basis.

 

ETFs changed the demand curve. Instead of episodic buying driven by sentiment, institutions buy according to asset-allocation models, rebalancing schedules, and inflow dynamics that are largely indifferent to on-chain issuance. When demand becomes steady and supply growth is fixed, the old cycle logic loses explanatory power.

 

This is why Bitwise expects 2026 to look structurally different from prior post-halving years. The report suggests that ETF inflows could absorb more than 100% of the net new supply of major assets such as BTC, ETH, and SOL. If correct, price discovery becomes a question of capital flows rather than mining economics.

 

FROM RETAIL VOLATILITY TO MACRO PRICING

 

A second pillar of the report is the idea that crypto’s pricing power is migrating away from retail-dominated exchanges toward institutional venues. Historically, price action was heavily influenced by leveraged positions on offshore platforms, which amplified volatility and produced frequent liquidations.

 

Bitwise argues that this structure is already changing. Institutional hedging and basis trades increasingly take place on regulated derivatives markets such as Chicago Mercantile Exchange. At the same time, spot exposure is often held through ETFs or custody platforms like Coinbase Prime, rather than retail order books.

 

This has important implications. When institutional capital dominates, macro variables begin to matter more than technical indicators. Inflation data, labor market reports, and interest-rate expectations can exert more influence on crypto prices than funding rates or chart patterns.

 

In that sense, Bitwise is not claiming that volatility disappears. Rather, volatility changes character. Crypto begins to resemble equities or commodities, where drawdowns are often driven by macro repricing instead of internal leverage cascades.

 

ETF INFLOWS AND “OVERBUYING” THE MARKET

 

One of the report’s more provocative claims is that ETFs may systematically “overbuy” crypto assets relative to new supply. This does not imply irrationality. It reflects how asset managers operate.

 

When a new asset class becomes acceptable within portfolios, flows tend to arrive in waves. Advisors who were previously constrained by compliance or reputational risk suddenly gain permission to allocate. Even small percentage allocations, when applied across large pools of capital, can overwhelm organic supply growth.

 

Bitwise’s historical track record lends some credibility to this view. In prior years, it accurately anticipated the approval and success of spot ETFs, as well as the resilience of Ethereum following major upgrades. At the same time, the report has shown a consistent optimism bias, particularly in price targets for ETH and smaller assets.

 

This tension is important. The structural argument about flows may be sound, while point estimates remain vulnerable to sentiment and timing errors.

 

A SHIFT IN PRICE DISCOVERY

 

If pricing power moves to institutional venues, the consequences extend beyond volatility. Price discovery itself becomes more centralized around regulated markets and large custodians.

 

Institutions often pair spot exposure with futures hedges, capturing basis yields rather than directional bets. In practice, this means that large players can influence spot prices through derivatives positioning, especially when liquidity is thin.

 

The implication is subtle but profound. In a market where the marginal buyer is a pension fund or insurance allocator, crypto prices may increasingly reflect the same risk-on and risk-off dynamics seen in equities. This supports Bitwise’s thesis that crypto is entering a phase of macro integration rather than remaining an isolated speculative arena.

 

THE INSTITUTIONAL SIGNALING EFFECT

 

Bitwise also highlights the signaling power of elite institutions. The report suggests that a meaningful portion of endowments associated with top U.S. universities could hold crypto exposure in the coming years. Whether the exact percentage is reached matters less than the direction.

 

Historically, these institutions have played an outsized role in legitimizing new asset classes, from private equity to venture capital. Their participation does not guarantee outsized returns, but it often marks a transition from fringe to accepted allocation.

 

For crypto, this matters because reputation risk has been one of the biggest barriers to adoption. Once that barrier erodes, flows tend to follow.

 

THE RISE OF ON-CHAIN INSTITUTIONAL FINANCE

 

Perhaps the most forward-looking section of the report concerns the evolution of ETFs themselves. Bitwise describes a future in which institutional assets are no longer passive holdings locked in custody, but programmable capital deployed on-chain.

 

Regulatory developments in the U.S. have begun to acknowledge this possibility. Under evolving frameworks overseen by the U.S. Securities and Exchange Commission, certain regulated entities may eventually interact with blockchain-based infrastructure in compliant ways.

 

The implication is that institutional crypto holdings could become productive. Instead of sitting idle, assets might be used as collateral, participate in tokenized real-world assets, or generate yield within regulated on-chain environments.

 

If realized, this would blur the line between traditional finance and DeFi, creating a hybrid system where balance sheets operate across both worlds. It also explains why Bitwise places so much emphasis on infrastructure and regulation rather than individual tokens.

 

CAUTION BENEATH THE OPTIMISM

 

Despite its strengths, the report is not without weaknesses. As an asset manager, Bitwise has a structural incentive to frame the future in constructive terms. This bias shows most clearly in its treatment of altcoins and aggressive price targets.

 

The underperformance of ETH relative to BTC in recent cycles illustrates the risk of extrapolating institutional narratives too far. Institutions may adopt crypto, but they are not immune to risk aversion or herding behavior. Retail sentiment still matters, particularly for assets outside the core.

 

For this reason, Bitwise’s projections are best read as directional rather than definitive. The macro shift it describes is real, but its expression in prices may be uneven and nonlinear.

 

CONCLUSION: A DIFFERENT KIND OF CYCLE

 

Bitwise’s core insight is not that crypto will only go up, but that the rules of the game are changing. As ETFs, regulation, and institutional custody reshape the market, crypto begins to behave less like a speculative subculture and more like an integrated financial asset.

 

This does not eliminate risk. It redistributes it. Cycles may become longer, drawdowns may be driven by macro shocks, and returns may concentrate in assets that fit institutional mandates.

 

For investors and analysts, the challenge is to adapt. Understanding issuance schedules and on-chain metrics remains important, but it is no longer sufficient. In the coming years, crypto analysis will increasingly require the same macro awareness demanded by equities and fixed income.

 

If Bitwise is right, 2026 will not mark the next explosive retail-driven bull market. Instead, it may be remembered as the point when crypto quietly crossed the threshold into mainstream capital allocation.

 

The above viewpoints are referenced from @Web3___Ace

〈Bitwise: Why Crypto Is Moving Beyond the Four-Year Cycle〉這篇文章最早發佈於《CoinRank》。