Microsoft(US:MSFT) The Economic Times·2026-01-02 19:21Core Viewpoint - Bitcoin is at a critical juncture as it begins 2026, with analysts divided on whether it will experience a significant rally or a substantial pullback following a volatile end to 2025 [1][13]. Group 1: Market Drivers - The outlook for Bitcoin in 2026 is influenced by key factors such as monetary policy, liquidity, regulation, and institutional demand, which are expected to shape price movements on a quarterly basis rather than establishing a clear trend [2][11]. - Improving macroeconomic conditions and easing fear in the crypto markets are seen as potential stabilizers for Bitcoin prices [12][14]. Group 2: Analyst Perspectives - Some strategists, like Fabian Dori from Sygnum Bank, suggest that the early months of 2026 could be positive for Bitcoin due to improving macro conditions and a reduction in market fear [3][4]. - Dori also noted signs of an accelerating business cycle, including better purchasing managers' indices and easing liquidity as quantitative tightening slows down [4][6]. Group 3: Regulatory Impact - Progress on U.S. regulation, particularly the proposed Clarity Act, may enhance market confidence by clarifying the classification of digital assets, although near-term risks such as a potential U.S. government shutdown could introduce volatility [6][14]. Group 4: Bearish Outlook - Conversely, some analysts, including Mike McGlone from Bloomberg Intelligence, warn of a possible decline in Bitcoin prices towards $50,000, linking this to broader normalization across risk assets and potential deflationary adjustments in equities [7][8][14]. Group 5: Consolidation Expectations - Bitfinex analysts predict that the first quarter of 2026 will likely be characterized by consolidation as markets adjust to the volatility of late 2025, with liquidity conditions expected to gradually improve [9][10][14].