Tokenization 'supercycle' set to drive crypto’s next leg higher in 2026: Bernstein

Core Viewpoint - Bernstein predicts that 2026 will likely mark the beginning of a tokenization "supercycle," suggesting that digital assets have likely bottomed out after a weak end to 2025, presenting market dips as opportunities to invest in crypto-linked stocks [1] Group 1: Market Forecasts - Bernstein maintains its Bitcoin (BTC) price forecast at $150,000 for 2026, with a peak target of $200,000 for 2027, while Bitcoin was trading around $91,600 at the time of the report [2] - Despite Bitcoin finishing 2025 down approximately 6%, crypto equities achieved their strongest year on record with average returns of about 59% [2] Group 2: Investment Opportunities - Outperform-rated companies identified as the "best tokenization proxies" include Robinhood (HOOD), Coinbase (COIN), Figure (FIGR), and Circle (CRCL) [3] - Bernstein has reduced its price target for Circle to $190 from $230 and for Coinbase to $440 from $510, with both stocks experiencing declines in early trading [3] Group 3: Stablecoins and Their Growth - Stablecoins are expected to expand beyond crypto trading into mainstream banking and payments, with total supply projected to rise 56% year-over-year to approximately $420 billion by 2026 [4] - The growth of stablecoins is supported by cross-border business payments, consumer remittances, and stablecoin-based neobanks [4][5] Group 4: Tokenization and Onchain Value - Tokenization, which involves converting real-world assets into blockchain-based tokens, is a key component of the analysts' thesis, with onchain value locked in tokenized assets expected to more than double from around $37 billion in 2025 to about $80 billion in 2026 [6] Group 5: Prediction Markets - Total volumes in prediction markets are projected to grow by 100% in 2026 to roughly $70 billion, which could generate about $1.4 billion in annual revenue for market makers and exchanges based on average contract fees [7]