Bitcoin Faces Consolidation After Disappointing 2025, Analysts Cautious on Near Term

• Bitcoin ended 2025 lower than it started, while gold and the S&P 500 delivered superior returns to investors over the same period.
• Analysts expect 2026 may be a slower year for crypto, with the market digesting Bitcoin’s substantial three-year gains rather than generating fresh momentum.
• Recent price movements have been driven largely by exchange-traded fund inflows rather than organic on-chain demand, potentially masking weaker underlying fundamentals.
• Valuation metrics suggest Bitcoin’s market price has outpaced its on-chain fundamentals, indicating consolidation or modest pullbacks are more likely than significant gains near-term.

Anyone disappointed with the year Bitcoin had in 2025 could face more frustration in 2026. While BTC started 2025 at US$93,507 (AU$139,667) and reached an all-time high of US$126,080 (AU$188,320) in October, it closed the year at just US$88,414 (AU$132,060).

Bitcoin’s 2025 performance, source:CoinGecko

Meanwhile, gold went from roughly US$2,650 (AU$3,959) in January, closing the year at US$4,340 (AU$6,484), while the S&P 500 rose from around 5,900 to about 6,800 – making both better investments, at least in 2025 terms.

And although there’s no doubt about Bitcoin’s long-term store-of-value proposition, some analysts have now made more concerning forecasts.

Jim Ferraioli of Schwab’s Center for Financial Research, who is the director of crypto research and strategy, said that although the team believes “2026 is going to be a positive year for bitcoin”, they are concerned about the medium term. He said we may not see much excitement in the months ahead:

But this could be a more boring year in crypto terms. From the low in November 2022 to the intraday peak last October of $126,000, bitcoin returned 8x in three years. The market is still digesting that.

Jim Ferraioli of Schwab’s Center for Financial Research

He mentioned that after BTC’s October peak, network usage weakened and price action became increasingly dependent on capital flowing into exchange-traded funds rather than organic on-chain demand.

Ferraioli added that subdued fees, profit-taking by long-term holders, and shrinking exchange balances reflected this transition. While this has broadened access to Bitcoin, it may also be skewing short-term market signals, with clearer regulation likely needed before deeper institutional participation can support a more durable advance.

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Watch The Coming Weeks, Analyst Suggests

Gerry O’Shea, head of global market insights at Hashdex, sang a similar tune, saying there may be catalysts to support higher prices in the coming weeks, but that for now “we’re in a range-bound market”. He pointed to a potential slowdown in US crypto legislation and a possible shift in monetary policy.

Additionally, data from CryptoQuant suggests that Bitcoin’s valuation has run ahead of its underlying on-chain fundamentals, pointing to fading upside momentum rather than an imminent breakout. Until valuation metrics improve, the balance of signals leans towards consolidation or cooling instead of renewed strength, the firm recently wrote on Crypto Twitter.

MVRV compares Bitcoin’s market value (current price) to its realised value (the average price at which coins last moved). When elevated, Bitcoin tends to look expensive relative to its on-chain cost basis, often coinciding with slower gains or pullbacks.

Elevated readings suggest the market is still digesting prior gains – echoing Ferraioli’s point that ETF flows, rather than organic on-chain activity, are driving price, which can dampen momentum in the short term.

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