The king cryptocurrency entered the new year below $90,000 and had a yearly close below the level at the beginning of 2025. Crypto has been quite challenging over the past year, with numerous major developments weighing on the price and us not being able to rejoice in BTC ATH highs. For now, we do not see a start like 2022, but Henrik says the markets will crash.
The Only Crypto Rise in 2026
Henrik likens it to a diabetic coma. He predicts that we will see a rapid rise in the short term, but a harbinger of a big decline. For 2026, Wall Street giants are extremely hopeful and think that technology-focused share growth will continue. interest rate cuts With the continuation and monetary expansion of risk markets, asset groups including crypto are expected to rise.
But although Henrik is optimistic in the short term, he believes we are now approaching the end of the road.
“Frankly, I’m optimistic too – but only in the very short term. I think we’re in a ‘sugar coma’ kind of rally right now, a euphoria that could push markets even higher in early 2026. But I’m also increasingly worried that this is the final burst of a giant bubble.” Ray Dalio He warned: “We are 80% into the bubble, and usually in the last 20% of the bubble, markets go vertical and no one looks at the underlying risks.””
There is a dilemma he points out. While the real economy is quietly declining, risk markets are rising. According to the analyst, we are seeing what we need to see in the final stages of major cycles. Recalling the years 1999 and 2007, the analyst underlines that while basic economic indicators were declining, stocks also reached new peaks in those days.
“I see a similar situation now. Yes, we could see an explosive rise in the coming weeks, perhaps a parabolic rise that market historians will talk about for years. But as the facts emerge, a sharp decline will follow. The main message: Enjoy the party, but know the way out.”
Business Cycle and Cryptocurrencies
with cryptocurrencies business cycle It is highly related and this was considered one of the main reasons why there would be no increase in 2025. Non-Farm Employment and ADP employment reports promise worse than 2025. In other words, employment growth has stopped, a pattern rarely seen outside of recessionary periods. The decline in labor force data jumped from expansion in the middle phase of the cycle to slowdown at the end of the cycle, according to Henrik. In other words, it is expected to rise due to the business cycle. cryptocurrencies will not experience a real rise.
“Beyond jobs, other classic end-of-cycle indicators are also kicking in. Manufacturing indexes and shipping volumes peaked a year ago and are declining. Corporate earnings growth has flattened. Banks have tightened credit standards. We’re not seeing a sudden collapse – no, it’s a gradually worsening situation that’s easy to overlook as asset prices rise.”
That’s why I say this environment is more like 2007 (a slow reversal of the cycle) than 2020 (a sudden external shock).
In 2006-07, the housing market crashed, employment slowed, the yield curve inverted – all while stocks continued to reach new highs. The same elements are present now: a long-term recession in the housing market, a long reversal that we are behind, falling leading indicators, weakening employment and even early increases in unemployment claims. “While crowds continue to have fun in the markets, the business cycle continues on borrowed time.”
Recession is Coming
in 2023 recession We heard the bells ringing louder on Wall Street than they do these days. Today, while more growth is being talked about, some fundamental indicators point to an impending recession (and thus a cryptocurrency collapse).
“Key indicators such as GDP remain positive (modest growth likely recorded in Q4 2025) and consumer spending has held up longer than many expected (thanks in part to residual savings and wage increases). But recession storm clouds are gathering and I predict the rain will soon begin. Several classic recession signals are now emerging in earnest. The most famous, the yield curve, has been inverted for a long time and is now rapidly steepening. Historically, the 10-year and 3-month “A dramatic reversal of the Treasury yield spread followed by a sharp upward reversal has heralded a recession. That’s exactly what’s happening now: The Fed’s aggressive rate hikes inverted the curve deeply in 2022-24, and now with rate cuts on the horizon, the curve is taking an upward turn again.”
2026 is full of unknowns. How quickly will the Fed make cuts with its new Chairman? Will labor markets recover quickly? Can Trump win the midterm elections? Cryptocurrency regulations Will he be able to progress on the compressed schedule? The answers to all these and more will determine the path cryptocurrencies will follow in 2026. However, Henrik, a well-known name in macroeconomics, is not very hopeful.
