Can Crypto Overcome Its Growing Pains in 2026?

The cryptocurrency market has been stuck in a rut, with Bitcoin and other digital assets struggling to regain the momentum that drove them to record highs in the past. However, experts believe that 2026 could be the year that crypto overcomes its growing pains and enters a new phase of growth.

One potential catalyst for this growth is the long-awaited Clarity Act, which aims to bring regulatory clarity to the US crypto market. According to JPMorgan analysts, a clear regulatory framework could unlock institutional participation, deepen liquidity, and potentially drive a significant upside in the market. The bill, which would split SEC/CFTC oversight and ease compliance for certain tokens, has been stalled in the Senate due to industry divisions and delays.

Another factor that could contribute to the growth of the crypto market is industry consolidation. Crypto treasury companies, which manage digital assets on behalf of institutions and individuals, are likely to consolidate in 2026, according to a crypto executive. This consolidation could lead to increased efficiency and reduced costs, making it more attractive for investors to enter the market.

However, the crypto market also faces challenges, particularly when it comes to inheritance and succession planning. The self-custody culture of Bitcoin has created an inheritance time bomb, as many holders still rely on a single point of failure to manage their assets. A recent report from the Gannett Trust warns that 2026 may be the year that this issue starts to detonate, as early adopters begin to "button up" succession plans.

Meanwhile, the use of stablecoins is evolving, with the "stablecoin sandwich" model becoming less relevant. According to Christian Catalini, the co-creator of Meta's abandoned Diem token, the real competitive advantage in stablecoins now lies in the distribution held by incumbents. This shift in focus towards user relationships could lead to a more robust and user-friendly stablecoin market.

In addition to these developments, the crypto market is also being shaped by global events. The crisis in Iran has put the spotlight on the country's $7.8 billion crypto shadow economy, which relies on state-sponsored Bitcoin mining and stablecoins to bypass the US dollar. The Iranian government uses this infrastructure for international trade, while ordinary Iranians rely on it as a financial lifeline during protests and economic crises.

As the crypto market navigates these challenges and opportunities, one thing is clear: 2026 is shaping up to be a pivotal year for the industry. Whether it will be a year of growth and momentum or continued stagnation remains to be seen, but one thing is certain - the crypto market will continue to evolve and adapt to changing circumstances.

Sources:

• "Bitcoin is stuck in a rut but JPMorgan says new legislation could be the ultimate spark" by Will Canny, AI Boost
• "Crypto treasury companies likely to consolidate in 2026: Crypto exec" by Cointelegraph
• "Iran crisis puts the regime's $7.8 billion crypto shadow economy in spotlight" by Francisco Rodrigues, AI Boost
• "Bitcoin’s self custody culture created an inheritance time bomb, and 2026 may be when it starts detonating" by Gannett Trust
• "The 'stablecoin sandwich' is dead: Why the next phase of crypto payments is all about the user relationship" by Ian Allison, CoinDesk