21Shares cut several of its 2026 crypto forecasts, saying institutional adoption continued to grow even as weak pricing and slowing institutional adoption delayed some of the sector’s recovery.
According to 21Shares’ mid-year outlook, the digital assets sector continued to build stronger infrastructure despite a challenging market environment.
The asset manager said progress in areas such as exchange-traded funds, stablecoin regulation, tokenization and market forecasting has exceeded what recent price action suggests. Still, falling crypto prices, major decentralized finance exploits, and slower enterprise adoption have prompted the company to lower several expectations it set earlier this year.
The report claims that institutional participation has increased without changing Bitcoin’s long-established market structure. According to 21Shares, Bitcoin reached around $126,000 in October 2025 before entering a decline that largely followed historical post-halving patterns. Even though greater institutional participation reduced the severity of withdrawals, the company said the four-year market cycle remained intact.
Former 21Shares co-founder Ophelia Snyder, who left the company after it was acquired by FalconX in 2025, recently expressed a similar view in a Substack article.
Snyder wrote that crypto’s investor base has become more institutional and increasingly tied to the broader financial system, making prices more responsive to macroeconomic developments, geopolitical events and competing investment narratives.
Forecast markets and consolidation stand out
Among the top-performing segments, 21Shares has identified prediction markets as one of the fastest growing sectors in the industry. The company expects the annual trading volume in the planned markets to exceed $100 billion this year.
The report also identifies consolidation as an accelerating trend in crypto markets. According to 21Shares, several publicly traded companies that hold digital assets on their balance sheets are trading below the value of their crypto holdings, increasing the likelihood of mergers or acquisitions among smaller treasury companies.
A comparable model is developing within the Ethereum layer 2 ecosystem. The report says a small number of large rollups continue to capture users and liquidity, while many smaller networks struggle to create meaningful activity.
Institutional investors continue to accumulate despite volatility
Crypto investment products also continued to attract institutional capital despite recent market weakness, according to the report.
Although Bitcoin spot exchange-traded funds in the United States have seen about $3 billion in net outflows this year, 21Shares said ETF holdings remain above 1.25 million BTC, near an all-time high. The company argued that these figures indicate that many investors maintained or quietly increased their positions instead of exiting the market during the downturn.
Recent market volatility has nevertheless weighed on sentiment. As crypto.news reported earlier, a stronger-than-expected U.S. PCE inflation figure renewed concerns that the Federal Reserve could maintain tighter monetary policy for longer, triggering nearly $1.5 billion in crypto selloffs and pushing Bitcoin, major altcoins and crypto-related stocks lower.
Earlier this week, Bank of America also revised its outlook to forecast three Federal Reserve rate hikes of 25 basis points this year, citing lingering inflation risks.
Despite the latest wave of sell-offs, some institutions have maintained their long-term outlook. As crypto.news reported earlier in June, Standard Chartered’s Geoffrey Kendrick reiterated the bank’s $100,000 Bitcoin and $4,000 Ethereum targets following an earlier market decline.
Kendrick argued at the time that Bitcoin’s decline toward $59,000 likely represented the bottom of the cycle, while stronger ETF flows and institutional demand remained key conditions supporting the bank’s long-term price targets.
Looking ahead, 21Shares said improving regulatory clarity in the United States continues to support product launches. The company pointed to the Securities and Exchange Commission’s generic listing standards, which accelerated approvals beyond Bitcoin and Ether products.
Hyperliquidity was cited as an example, with the report noting that US spot ETFs that track the asset gathered more than $150 in net inflows in their first million months, signaling continued institutional interest in digital assets.