As 2026 begins, cryptocurrency markets worldwide have demonstrated notable upward momentum, marked by a pronounced rebound in major digital assets such as Bitcoin, Ethereum, and numerous altcoins. Bitcoin's price has surpassed critical technical barriers, renewing discussions about a potential rally toward the $100,000 mark.
Entrepreneur and bitcoin advocate Lark Davis highlighted a significant recovery in the crypto market capitalization, which has surged by more than $250 billion since the start of the year. Specifically, Bitcoin's value has increased by approximately 7%, Ethereum has gained nearly 9%, and several prominent alternative coins are showing double-digit percentage increases. In addition, meme coins have experienced sharp appreciation.
Davis identified five principal factors driving this resurgence:
- Conclusion of Tax-Loss Harvesting: The typical selling pressure seen in December, attributed to investors harvesting tax losses, has dissipated. This alleviation of downside selling pressure has created conditions conducive to rebound buying in early January.
- Strong Spot Bitcoin ETF Inflows: There has been a pronounced reversal in spot Bitcoin Exchange-Traded Fund inflows. Some of the largest inflow days since October have been recorded, reflecting institutional demand and contributing to upward price pressure.
- Anticipation of Looser U.S. Monetary Policy: Market expectations are building around the likelihood that then-President Donald Trump will appoint a Federal Reserve chair with a more dovish stance amid historically high U.S. debt levels. This anticipated shift toward easing monetary conditions is supportive for risk assets such as cryptocurrencies.
- Technical Relief Rally: Following a roughly 35 percent decline from peak levels in October 2025, Bitcoin and other cryptocurrencies entered a statistically probable rebound phase as part of a technical correction.
- Geopolitical Developments in Venezuela: Events unfolding in Venezuela may exert downward pressure on oil prices, potentially reducing inflationary pressures elsewhere and offering the Federal Reserve greater flexibility to cut interest rates, thus benefiting broader financial markets.
These convergent factors—reduced selling, renewed institutional participation through ETFs, and a macroeconomic environment anticipating easier policy—have collectively provided a strong foundation for positive market performance in the early weeks of 2026.
Bitcoin, however, faces notable resistance levels at approximately $94,500, as well as the psychologically significant $100,000 price point. In recent trading sessions, Bitcoin's price approached near $94,000 but encountered resistance, resulting in its first daily decline of the year with a roughly 3 percent drop during the New York market open. The price fell swiftly from around $94,300 to $91,200 within hours before rallying nearly 2 percent following the announcement that MSCI would maintain Bitcoin Strategy in its index.
At the time of reporting, Bitcoin is trading near $92,000. Market participants remain attentive to whether it will reclaim and sustain levels above $94,000 or experience further setbacks when U.S. markets open.
Market sentiment indicators have shifted substantially; the Crypto Fear & Greed Index has risen by 22 points since January 1, reaching 41—the highest reading since October 2025. This confirms the rapid transition from caution to bullishness accompanying the price upswing.
Ethereum's performance mirrors this strong start, rising by approximately 9 percent, accompanied by widespread gains in major altcoins and meme tokens, highlighting broad market participation in the current rally.