Author: ARK Invest
Translation: Felix, PANews
In the macro context of 2026, ARK Invest points out that four major trends are enhancing Bitcoin’s value and believes that Bitcoin is evolving from an “optional” fringe asset into an indispensable strategic asset in institutional portfolios. Below are the details.
In 2025, Bitcoin continues to deeply integrate into the global financial system. The launch and growth of Bitcoin spot ETFs in 2024 and 2025, the inclusion of digital asset listed companies in major stock indices, and increasing regulatory transparency are driving Bitcoin from the fringes toward a new asset class that ARK Invest considers worthy of institutional allocation.
ARK Invest believes that the core theme of this cycle is Bitcoin’s transformation: from an emerging “optional” currency technology to a strategic allocation asset increasingly recognized by investors. Four major trends are boosting Bitcoin’s value proposition:
- Macroeconomic and policy backdrop shaping demand for scarce digital assets
- Structural ownership trends involving ETFs, corporations, and sovereign nations
- The relationship between Bitcoin, gold, and broader stores of value
- Compared to previous cycles, Bitcoin’s drawdowns and volatility are decreasing
This article will elaborate on these trends in detail.
2026 Macroeconomic Background
Money conditions and liquidity
After a prolonged period of monetary tightening, the macro landscape is changing: the US quantitative tightening (QT) ended last December, and the Federal Reserve’s rate-cut cycle remains in its early stages. Additionally, over $10 trillion in low-yield money market funds and fixed-income ETFs may soon rotate into risk assets.
Policy and regulatory normalization
Regulatory transparency is both a constraint on institutional adoption and a potential catalyst. Policymakers in the US and other countries have been advancing frameworks aimed at clarifying digital asset regulation, standardizing custody, trading, and disclosure processes, and providing more guidance for institutional allocators.
For example, if the US “CLARITY Act” is implemented—regulating digital commodities through the Commodity Futures Trading Commission (CFTC) and digital securities through the Securities and Exchange Commission (SEC)—it could significantly reduce compliance uncertainties for companies and institutions focused on digital assets. The act provides a lifecycle compliance roadmap for digital assets, using a standardized “maturity test” that allows tokens to transition from SEC to CFTC regulation after decentralization. It also enforces a dual registration system for broker-dealers, reducing the legal “vacuum” that historically allowed digital asset companies to operate offshore.
The US government has also addressed Bitcoin-related issues through:
- Legislator and industry leader discussions on including Bitcoin in national reserves
- Standardized management of seized Bitcoin holdings (currently mostly controlled by federal agencies)
- State-level adoption, with Texas leading by purchasing and including Bitcoin in its state reserves
Structural Demand: ETFs and DATs
As structural new buyers, ETFs
The scaling expansion of spot Bitcoin ETFs has reshaped market supply and demand. As shown below, by 2025, the amount of Bitcoin held by US spot ETFs and Digital Asset Trusts (DATs) is 1.2 times the combined new Bitcoin mined and dormant Bitcoin re-entering the market (active supply growth). By the end of 2025, total Bitcoin held by ETFs and DATs exceeds 12% of circulating supply. Despite demand outpacing supply growth, prices have declined, seemingly influenced by external factors: a large liquidation event triggered by a software glitch on October 10, concerns over the four-year Bitcoin cycle turning point, and negative sentiment around quantum computing threats to Bitcoin’s cryptography.
Source: ARK Investment Management LLC and 21Shares, 2026 forecast, data from Glassnode, as of December 31, 2025.
In Q4, Morgan Stanley and Vanguard included Bitcoin in their investment platforms. Morgan Stanley expanded channels for clients to access compliant Bitcoin products (including spot ETFs). Surprisingly, Vanguard, after years of rejecting cryptocurrencies and all commodities, also added third-party Bitcoin ETFs to its platform. As ETFs mature, they will increasingly serve as structural bridges connecting Bitcoin markets with traditional capital pools.
Bitcoin-related companies in indices, corporate adoption, and Bitcoin reserves
Corporate adoption of Bitcoin is no longer limited to early adopters. Companies like Coinbase and Block (formerly Square), included in the S&P 500 and Nasdaq 100 indices, have introduced Bitcoin exposure into mainstream portfolios. Previously, MicroStrategy, as a DAT entity, built a large Bitcoin position accounting for 3.5% of the total supply. Additionally, Bitcoin DAT companies currently hold over 1.1 million BTC, representing 5.7% of the supply (worth approximately $89.9 billion as of late January 2026). Most of these corporate reserves are held long-term rather than for short-term speculation.
Sovereign nations and strategic reserves
In 2025, following El Salvador, the Trump administration used seized Bitcoin to establish the US Strategic Bitcoin Reserve (SBR). Currently, this reserve holds about 325,437 BTC, representing 1.6% of the total supply, valued at $25.6 billion.
Bitcoin and Gold as Stores of Value
Gold outperforms, followed by Bitcoin?
In recent years, gold and Bitcoin have responded differently to macro narratives such as currency devaluation, negative real interest rates, and geopolitical risks. In 2025, driven by inflation fears and fiat currency depreciation, gold prices surged 64.7%. Surprisingly, Bitcoin prices declined 6.2%, a divergence that is not unprecedented.
In 2016 and 2019, gold’s rise led Bitcoin’s. During the COVID-19 pandemic in early 2020, surging fiscal and monetary liquidity also boosted Bitcoin alongside gold. As shown below, this “gold-Bitcoin” pattern was especially evident in 2017 and 2018. Will history repeat? Based on historical relationships, Bitcoin is a high-beta, digital-native extension under the same macro trading logic—this logic has historically supported gold.
Source: ARK Investment Management LLC and 21Shares, 2026, data from Glassnode and TradingView, as of January 31, 2026.
ETF asset management scale: Bitcoin shares continue to grow
Cumulative ETF net inflows offer another comparison between Bitcoin and gold. According to Glassnode and the World Gold Council, spot Bitcoin ETFs reached levels in less than two years that took over 15 years for gold ETFs, as shown below. In other words, financial advisors, institutions, and retail investors seem to increasingly recognize Bitcoin’s role as a store of value, diversification tool, and new asset class.
Source: ARK Investment Management LLC and 21Shares, 2025 forecast, data from Glassnode and the World Gold Council, as of December 31, 2025.
Notably, as shown below, since 2020, the correlation between Bitcoin and gold returns in the previous cycle has been very low. This suggests gold may serve as a leading indicator.
Note: The above matrix uses weekly return data from January 1, 2020, to January 6, 2026.
Market Structure and Investor Behavior
Drawdowns, volatility, and market maturity
Bitcoin is a highly volatile asset, but its drawdowns have decreased over time. In previous cycles, declines from peak to trough often exceeded 70–80%. In this cycle, since 2022 (up to February 8, 2026), declines from all-time highs have not exceeded about 50% (as shown below). This indicates that even during major corrections (such as the adjustment in the first week of February 2026), increased participation and deeper liquidity have led to more resilient market performance.
Source: ARK Investment Management LLC and 21Shares, 2025 forecast, data from Glassnode, as of January 31, 2026.
These observations suggest that Bitcoin is transitioning from a speculative asset to a globally tradable macro financial instrument, with a growing and diversified holder base supported by robust trading, liquidity, and custody infrastructure.
Long-term holding vs. timing the market
According to Glassnode data, even in the worst-case scenario—an investor who, from 2020 to 2025, invested $1,000 at the highest price each year—his total investment of about $6,000 would have grown to approximately $9,660 by December 31, 2025, and to about $8,680 by January 31, 2026, with returns of roughly 61% and 45%, respectively (as shown below). Even considering the February correction, by February 8, this investment would reach about $7,760, with a return of approximately 29%.
Source: ARK Investment Management LLC and 21Shares, 2026 forecast, data from Glassnode, as of January 31, 2026.
This demonstrates that since 2020, holding duration and position size are more important than timing entry: the market tends to reward investors focused on Bitcoin’s value proposition rather than its volatility.
Strategic Questions for Bitcoin in 2026
By 2026, the narrative around Bitcoin is no longer about whether it will “survive,” but about its role in diversified portfolios. Bitcoin is:
- A scarce, non-sovereign asset amid evolving global monetary policies, government deficits, and trade imbalances
- A high-beta extension of traditional stores of value like gold
- A macro tool with global liquidity accessible through regulated instruments
As regulation and infrastructure improvements lower entry barriers—including ETFs, corporations, and sovereign entities—long-term holders have absorbed significant new Bitcoin supply. Historical data also suggests that, due to Bitcoin’s low correlation with other assets (including gold), allocating to Bitcoin can improve risk-adjusted returns, especially as its volatility and drawdowns decrease over a full market cycle.
ARK Invest believes that when investors evaluate this new asset class in 2026, the question is no longer “whether” to allocate to Bitcoin, but “how much” and “through what channels.”
