Wall Street dominates crypto cash flow in 2025, but what will demand look like in 2026?

The year 2025 marks an unprecedented boom for Bitcoin and the entire crypto market, as crypto-friendly lawmakers push for a growth-oriented regulatory framework, while Wall Street finally officially recognizes Bitcoin, Ether, and a host of altcoins as a legitimate asset class worthy of inclusion in investment portfolios.

The global demand for Bitcoin, Ether, and Solana is almost immeasurable. The total net capital inflow into spot Bitcoin ETF funds in 2025 is around 57 billion USD, bringing the total net assets of all Bitcoin ETFs to 114.8 billion USD.

Net inflows into Bitcoin spot ETF funds in 2025 | Source: SoSoValue.comAs we move into 2026, the key question is: will the pace of crypto adoption at the institutional, corporate, and government levels — key price drivers in 2025 — continue to be maintained? Since October, inflows into Bitcoin spot ETFs have started to weaken, even shifting to a net outflow state for several consecutive weeks. This development has led to a correction of about 30% for Bitcoin and 50% for Ether.

What will drive the crypto market in 2026?

In an interview with Schwab Network, the Head of Markets at Cointelegraph, Ray Salmond, stated that the crypto market developments in early 2026 will depend on many intertwined factors.

According to him, the stories surrounding AI, expectations of the Fed cutting interest rates, the potential formation of a strategic Bitcoin reserve, and ETF cash flow are the factors that have driven the market in 2025. The question is whether these dynamics will still be strong enough to create a price rally in 2026, or if the market will need a new story to attract cash flow back.

In addition to the ETF capital flow and demand in large spot markets like Binance or Coinbase, investor sentiment towards the massive scale of the AI investment wave and the movements of the S&P 500 index — which is heavily influenced by technology factors — will also directly impact the crypto market.

AI, US stocks, and the spillover effect into crypto

The process of building global AI infrastructure, valuing companies, fundraising activities, IPOs, as well as the continued leadership of “big players” in data centers in the stock market along with the MAG7 group will be the focal point to watch in 2026.

Salmond stated that the strategy of rapidly expanding the balance sheet has helped technology stocks surge significantly in 2025, as hyperscalers spend tens of billions of USD on data centers, computing power, Nvidia's GPUs, and energy. However, in 2026, the market will require these companies to prove their ability to generate revenue from those investments, or at least maintain the expansion rate with internal cash flow.

In the second half of 2025, the stocks of Oracle, Meta, and Nvidia faced downward pressure as investors began to worry about these companies' free cash flow potentially weakening, even turning negative. If additional negative signals emerge in 2026 related to AI and quantum computing businesses that are highly leveraged but lack cash flow, the market could react strongly. If these shocks spill over to the SPX and Dow Jones indices, it is likely to indirectly impact crypto.

Clarity Act: A new catalyst for altcoin and DeFi?

A notable positive factor in early 2026 is the possibility of the Clarity Act being passed. Cryptocurrency lobbyists had hoped that this act would become law before the end of 2025, but the process was stalled due to the prolonged government shutdown.

If passed, the Clarity Act will establish a clearer legal framework, creating a favorable testing environment for FinTech companies in the U.S., while encouraging crypto businesses that have relocated abroad to return and establish their headquarters in the U.S.

This law will also clarify the regulatory authority between the SEC and CFTC over each type of crypto asset, depending on whether they are classified as securities or commodities. The enhancement of consumer protection and increased transparency are expected to help both businesses and investors feel more confident when participating in the crypto market.

Fed, Trump and the perspective of loose monetary policy

The policy of the Federal Reserve is expected to continue shifting towards easing, with the possibility of President Donald Trump appointing a new Fed Chairman at the beginning of 2026, paving the way for a maximum of 100 basis points rate cut.

According to Salmond, crypto investors generally view the Fed's interest rate cuts as a positive factor for risk assets. However, the market is falling into a state of “two opposing pictures,” as real economic data clashes with the most optimistic expectations.

He believes that the labor market is weakening and this trend is likely to extend into 2026. The “temporary” impact of the tariffs imposed by the Trump administration has driven up the costs of goods and services, increased health insurance premiums, while individual investor confidence may be waning due to rising layoffs, ballooning consumer debt, and declining disposable income.

On the contrary, investors still hope that the Fed's interest rate cuts will bring mortgage rates down, encouraging banks to loosen credit and stimulate consumption. However, returning to cheap money policies and large public spending also means that the U.S. is continuing to postpone the public debt issue.

Outlook 2026: Optimistic but Full of Unknowns

In Q1/2026, investors will face the question of whether the “Fed easing anticipation” trades have been fully reflected in the prices and are at risk of being sold off when the policy is confirmed, or whether the Fed's pivot will actually reactivate the bullish cycle of stocks and spill over into crypto.

Investors who prioritize flexibility and adaptability will have an advantage in a market heavily influenced by narratives and speculation, where the MAG7 and AI group may be overvalued.

Overall, the outlook for 2026 remains tilted towards a positive trend, especially when combining the economic direction of President Donald Trump, the Fed's monetary policy, and a more crypto-friendly legal environment. However, it is the actual results of the AI investment wave and the real impact of interest rate cuts on consumers and the economy that will be the key factors determining the market's direction in Q1 and Q2 of 2026.

Vương Tiễn