Bitcoin 2026 outlook: liquidity boost vs. midterm election risks
Bitcoin could see price gains in 2026 as looser monetary policy injects “massive” liquidity into financial markets, according to Abra CEO Bill Barhydt, while other market participants have issued more cautious projections.
Speaking with the Schwab Network, Barhydt said he anticipates substantial liquidity support from the US Federal Reserve next year as policymakers continue to reduce interest rates, with a potential return to quantitative easing that could lift risk assets such as Bitcoin. He noted signs of “quantitative easing light,” citing Fed purchases of its own bonds, and predicted weaker demand for government debt alongside lower rates — conditions he said are supportive for assets including Bitcoin.
Barhydt added that a combination of clearer US regulation, increasing institutional participation, and lower borrowing costs could set up Bitcoin and the broader crypto market for a strong multi-year period.
Only 14.9% of investors expect a rate cut at the January Federal Open Market Committee (FOMC) meeting, down from 23% in November, according to data from the Chicago Mercantile Exchange (CME) Group.
Analyst: BTC could find a low in 2026; US midterms seen as a risk
Some early Bitcoin adopters and analysts argue that 2026 could be a weak year for BTC. Early investor Michael Terpin projected that Bitcoin could bottom near about $60,000 in the final quarter of 2026.
Terpin expects a new Federal Reserve chair to continue easing policy, but said any improvement in macro conditions could be offset by the results of the 2026 US midterm elections. He said anything short of a GOP sweep could hinder further regulatory-friendly developments.
On prediction market Polymarket, the odds of a GOP sweep were 19% at the time of writing, while 47% of traders were pricing in split control of Congress between the two parties.
Joe Doll, general counsel at non-fungible token (NFT) marketplace Magic Eden, has previously said the balance of power “almost always” flips in US midterm elections.
#Bitcoin #Bitcoin Price #Bitcoin Regulation #US Government #United States #Interest Rate
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