Crypto Long & Short: 2026: The year institutions treat crypto as part of their core stack

CoinDesk Indices Share Share this article Copy link X icon X (Twitter) LinkedIn Facebook Email Crypto Long & Short: 2026: The year institutions treat crypto as part of their core stack In this week’s Crypto Long & Short Newsletter, Adeniyi Abiodun predicts that 2026 is the year Wall Street starts building on blockchain, not around it. Then, Andy Baer’s first Vibe Check of the year, reviewing the crypto’s quarterly mood swings in 2025 and the energetic start to 2026. By Adeniyi Abiodun , Andy Baehr , Francisco Rodrigues | Edited by Alexandra Levis Jan 7, 2026, 5:00 p.m. Make us preferred on Google (Uran Wang/Unsplash) What to know : You're reading Crypto Long & Short , our weekly newsletter featuring insights, news and analysis for the professional investor. Sign up here to get it in your inbox every Wednesday. Happy New Year! Welcome to our institutional newsletter, Crypto Long & Short. This week: Adeniyi Abiodun predicts that 2026 is the year Wall Street starts building on blockchain, not around it. Andy Baehr on crypto’s quarterly mood swings in 2025 and energetic start to 2026 Top headlines institutions should pay attention to, curated by Francisco Rodrigues Altcoin Sectors Spot Volume Share Thanks for joining us! STORY CONTINUES BELOW Don't miss another story. Subscribe to the Crypto Long & Short Newsletter today . See all newsletters Sign me up By signing up, you will receive emails about CoinDesk products and you agree to our terms of use and privacy policy . -Alexandra Levis Expert Insights 2026: The year institutions treat crypto as part of their core stack - By Adeniyi Abiodun , co-founder & CPO, Mysten Labs Institutional adoption of crypto accelerated in 2025. Spot bitcoin ETFs approached $170 billion at their peak, and BlackRock's IBIT alone nearly hit $100 billion. We saw major asset managers launch tokenized money market funds on public chains. But let's be clear about what we're looking at. ETFs are just wrappers. Wall Street added crypto to what they offer without changing how they operate underneath the skin. That will change in 2026, when blockchain infrastructure gets embedded into Wall Street’s core product stack. The technology is ready. Modern blockchains already deliver sub-second finality, internet-level scalability and predictable economics under high load. Infrastructure performance is no longer the bottleneck. On-chain assets have matured beyond simple tokens. They behave like the financial instruments Wall Street already uses, but with programmability legacy systems can't match. Fund logic, payment flows, compliance and structured products can all be encoded at the smart contract layer and run 24/7/365 at a fraction of the legacy rails cost. So, what’s missing? Adoption isn't a technology problem anymore. It's an integration problem. Institutions can't mass-migrate millions of clients on-chain overnight. Regulatory hurdles remain, even for basic products crypto takes for granted. Take custody, the simplest institutional use case. Even that requires robust identity management systems. The same compliance bar that exists for TradFi accounts. Then layer on licensing requirements, insurance and custody-specific regulations. The hurdles stack up fast. The good news is crypto is closing this gap. The most innovative crypto protocols now offer composable identity layers that let users access blockchain apps with credentials they already have. They integrate natively with blockchain infrastructure while still meeting enterprise compliance needs. These tools don't just replicate what TradFi does. They make verification faster, security stronger and management easier. Institutions also require reporting tooling that integrates with legacy accounting stacks. When a bank generates monthly client statements, those balances and transactions need to flow into existing systems like Oracle, SAP or NetSuite. If crypto requires a separate manual workflow, adoption stalls. Finance teams won't take on that operational burden. This is also getting fixed. Modern blockchains now come with API style integration layers, programmable audit trails and embedded permissioning. The infrastructure mirrors what TradFi requires. As these capabilities further mature in 2026, the industry will shift from experimental pilots to fully integrated financial workflows, allowing institutions to treat crypto as part of their core stack. I believe that by the midpoint of 2026 these last-mile tech obstacles will be solved. However, human nature is a factor, and some skeptics on Wall Street are still holding out, though there are fewer than ever. BlackRock CEO Larry Fink, who was once a prominent crypto skeptic, has publicly stated he was wrong about his initial assessment. JPMorgan is settling collateral on-chain. Visa and PayPal have embraced stablecoin rails. This is the year Wall Street starts building on blockchain, not around it. We’ll see the first fully on-chain lending products launched by traditional asset managers. Stablecoins will continue to gain ground quietly. Expect large portions of global FX settlement to move onto stablecoin rails. Tokenization will matter less as a talking point. Replacement will matter more. The tone of the conversation is going to change. Wall Street doesn’t need to believe in crypto. Adoption will be driven by market dynamics and client demand. That’s what 2026 will deliver: less hype and more integration. Headlines of the Week - By Francisco Rodrigues The cryptocurrency market started out 2026 with a bang as corporate heavyweights kept on accumulating bitcoin and global regulatory environments stood out. Beyond the markets, crypto’s utility is once again being leveraged in the geopolitical arena. Strategy, Tether boost bitcoin reserves : The world’s largest publicly traded bitcoin holder, Strategy (MSTR), bought 1,287 BTC for over $116 million in the final days of 2025 and early days of 2026, while major stablecoin issuer Tether added 8,888.88 BTC to its treasury as part of its Q4 profit allocation. PwC deepens crypto push as U.S. rules shift and stablecoins go mainstream : PricewaterhouseCoopers (PwC), one of the big four accounting firms, is deepening its engagement with cryptocurrency clients, citing greater regulatory clarity. $110 billion in crypto left South Korea in 2025 owing to strict trading rules : South Korea’s delay in implementing the Digital Asset Basic Act left a regulatory gap that pushed investors to offshore platforms. Iran accepts cryptocurrency as payment for advanced weapons : The expert center of Iran’s Ministry of Defense, Mindex, is accepting cryptocurrency payments for advanced weapons systems to bypass international sanctions. Winklevoss-backed Cypherpunk buys $28 million of zcash, now owns 1.7% of supply : Cypherpunk Technologies (CYPH), a crypto treasury firm backed by Gemini co-founders Cameron and Tyler Winklevoss, bought $28 million worth of privacy coin zcash. Vibe Check And, They’re Off! - By Andy Baehr, CFA , head of product and research, CoinDesk Indices Crypto leaps out of the gate in early 2026, looking back on four distinct quarters of performance and sentiment in 2025 Source: CAC Graphics Over the holiday break, I read 1929 , Andrew Ross Sorkin’s extremely popular account of the conditions that lead to the infamous stock market crash and the Great Depression. The opportunity to draw parallels to modern markets – both TradFi and crypto – was irresistible for Sorkin, and the shading of the characters and market conditions to help readers “get there” was at times unsubtle. Or maybe that’s just the facts as they were. One personal thread, not included in the book, was the connection of several of the dynasties to horseracing, the Sport of Kings: Mills and Phipps, Whitney and Vanderbilt, dynastic families whose thoroughbreds and grandstand box inhabitants I used to see every August at Saratoga. Today, horseracing may be supplanted by the NFL, NBA, Major League Baseball and Formula 1, but the theme of reconvening power in a private owner’s box on the weekend and cultivating a winning team has endured. Crypto certainly leapt out of the starting gate at the start of 2026, helpfully adhering to our observation that the crypto market measures mood in quarters. The heartbreak drawdown of late Q4 2025 is, for now, in the rear view. Shaking off the confounding numbness of December’s pinned crypto prices (the metaphor of trying to start a flooded outboard engine came to mind), tokens leapt forward, well rested. The CoinDesk Memecoin Index spiked 25% as revelers resolved to spend more time with their memes. Seeing ETH regain strength and support good newsflow is significant (the validator entry queue now exceeds the exit queue). As we posited in early 2025, ETH-led rallies will invite greater breadth (and health) in the market. BNB (which will enter the CoinDesk 5 and CoinDesk 20 Indices at the end of January) and BTC looked on, mature and steady. Crypto leapt out of the gate in the early days of 2026 (all indexed to 100) Back to those four quarters of 2025. As we lay out in detail in our forthcoming Quarterly Review, the heartbreak drawdown of Q4 loomed large, defying predictions and patterns, suffocating positive narratives. Looking at performance of CoinDesk 20 constituents quarter by quarter provides a good summary of 2025’s triumphs and struggles. 2025 - Progress Accelerates, Markets Lag Source: CoinDesk Indices. Green bars are CoinDesk 5 and CoinDesk 20. Dark gold bars are CoinDesk 5 constituents. All gold bars are CoinDesk 20 constituents. Some assets were constituents only part of the quarter or year, in which case performance during their time in the index is shown. For additional commentary, the CoinDesk Quarterly Review and Outlook will be released tomorrow in the Crypto for Advisors newsletter. Subscribe today and be the first to receive the research report. Chart of the Week Altcoin Sectors Spot Volume Share Memecoin trading volumes surged in early January jumping from a 12.9% low in December to 41% of altcoin exchange activity. This expansion came largely at the expense of privacy coins, which fell from a 61% peak to 14% over the same period. The memecoin rally is being led by major tokens like PEPE and MOG, both over 40% YTD. Memecoin activity frequently signals broader market momentum, making this surge an important indicator to watch for a potential market-wide recovery. Listen. Read. Watch. Engage. Listen: Paul Veradittakit , managing partner at Pantera Capital , shares his 2026 predictions on crypto, real-world asset tokenization and AI. Read: CoinDesk's Most Influential in Crypto 2025. Watch: Andrew Baehr ’s final FINTECH.TV segment for 2025 covering stablecoin rewards action and looking ahead to 2026 . Engage: Follow CoinDesk Data & Indices on LinkedIn and X ( @coindeskmarkets ) for the latest research reports and market commentaries. Crypto Long & Short CoinDesk Indices Institutional Investment Institutional Investors Institutional Adoption Spot bitcoin etf More For You KuCoin Hits Record Market Share as 2025 Volumes Outpace Crypto Market By CoinDesk Research Dec 22, 2025 Commissioned by KuCoin KuCoin captured a record share of centralised exchange volume in 2025, with more than $1.25tn traded as its volumes grew faster than the wider crypto market. What to know : KuCoin recorded over $1.25 trillion in total trading volume in 2025 , equivalent to an average of roughly $114 billion per month , marking its strongest year on record. This performance translated into an all-time high share of centralised exchange volume , as KuCoin’s activity expanded faster than aggregate CEX volumes , which slowed during periods of lower market volatility. Spot and derivatives volumes were evenly split , each exceeding $500 billion for the year, signalling broad-based usage rather than reliance on a single product line. Altcoins accounted for the majority of trading activity , reinforcing KuCoin’s role as a primary liquidity venue beyond BTC and ETH at a time when majors saw more muted turnover. Even as overall crypto volumes softened mid-year, KuCoin maintained elevated baseline activity , indicating structurally higher user engagement rather than short-lived volume spikes. View Full Report More For You CoinDesk 20 Performance Update: Uniswap (UNI) Falls 1.5% as Index Trades Lower By CoinDesk Indices 2 hours ago Hedera (HBAR) was also among the underperformers, down 1.4% from Tuesday. Read full story