21Shares projects Bitcoin will recover to $100,000 by year-end, maintaining its base case despite a broader market correction. The firm attributes this resilience to a shift from speculative retail activity to institutional adoption, with Bitcoin increasingly behaving like a macro asset. This outlook is detailed in 21Shares' State of Crypto Mid-Year Check-In report published on June 24, which highlights stablecoins and tokenization as the sector's strongest long-term themes.

Market Maturation and Institutional Trends

The first half of 2026 has been defined by macroeconomic uncertainty, tighter liquidity conditions, and a broad correction in digital assets. Despite this volatility, 21Shares argues that the industry's underlying fundamentals continue to strengthen. Institutional adoption remains the dominant structural trend, supported by expanding ETF and ETP participation, improving regulatory clarity, and growing corporate and sovereign interest in digital assets. The firm also points to the growing intersection between artificial intelligence and blockchain, suggesting decentralized networks could provide infrastructure for autonomous AI agents and machine-to-machine payments.

Bitcoin Cycle and Price Dynamics

Bitcoin's price correction has prevented the industry from reaching 21Shares' projected $400 billion target for assets under management by ETFs this year. However, the firm emphasizes that the current cycle is unfolding differently from previous bull markets. While the number of wallets holding BTC continues to grow, the year-end base case remains a recovery toward $100,000 rather than a breakout to new all-time highs. Ethereum continues to strengthen its role as the infrastructure layer for tokenized finance and decentralized applications.

Corporate Treasury and ETF Assets

Corporate crypto treasury adoption has slowed amid weaker market conditions and higher financing costs, leading many companies to pause expansion plans. 21Shares expects the sector to consolidate, with well-capitalized firms continuing to accumulate digital assets while weaker players struggle to raise capital. By May 2026, total global crypto ETF assets under management stood around $140 billion, down roughly 15% year-to-date, with Bitcoin ETFs accounting for almost $110 billion.

Prediction Markets and Future Outlook

Blockchain-based prediction markets have emerged as one of crypto's fastest-growing applications, fueled by increasing user participation and improved liquidity. 21Shares now expects cumulative trading volumes to comfortably exceed its earlier $100 billion forecast. Through May 2026, prediction markets have recorded $57.5 billion in volume, marking over 10 times the volume of the same period in the prior year.

Bitcoin trades around $60,000 as analysts remain divided on whether a durable market bottom has formed, with recent price action reflecting significant volatility and capital rotation. The cryptocurrency recently dropped to $59,356 on June 26, 2026, down almost 3% in 24 hours, pressured by a massive options expiry and a hotter-than-expected inflation report. This collision of events, including roughly $10.6 billion in bitcoin options contracts expiring on Deribit and a May Personal Consumption Expenditures (PCE) reading of 4.1%, has prompted investors to rotate out of risk assets into safer bonds. Despite the decline, analysts note that the current drawdown from its all-time high of approximately $126,000 has been slower than previous cycles due to a more institutionalized investor base.

Market Volatility and Liquidations

The options expiry on Deribit involved approximately $10.6 billion in contracts, a significant liquidity event where about 80% were "out of the money," forcing traders to unwind positions. This dynamic adds volatility, though the put-to-call ratio stood at 0.83, indicating bullish bets still outnumbered bearish ones. Recent data shows 90,825 traders were liquidated in the past 24 hours for $484.09 million. Analysts suggest the final bottom may form in the $50,000–$53,000 range, with the bear market potentially extending into September, as the market has not yet seen the historical capitulation levels of 60%–65% drawdowns observed in prior cycles.

Institutional Outflows and Strategy Pressure

Structural headwinds persist as U.S. spot bitcoin ETFs recorded $696.3 million in net outflows on Thursday, contributing to $6.4 billion in outflows over the past 30 days, the largest monthly outflow since their launch in 2024. Spot Ethereum ETFs also saw net outflows of $81.9 million. Strategy, the largest corporate holder of bitcoin with over 846,000 BTC, faces mounting challenges; its preferred stock (STRC) fell to $73.62, a record low. CryptoQuant reports Strategy's cash reserves have dropped sharply this year while its dividend bill has nearly quadrupled, reducing the runway for those reserves from over seven years to about 14 months. Additionally, law firm Rosen Law Firm announced an investigation into Strategy and CEO Michael Saylor for potential securities violations on June 24.