The optimism that ushered in 2026 for Bitcoin is rapidly dissipating, with prediction market data and on-chain analysis pointing to a significant loss of trader conviction and a likely extended period of sideways price action. According to data from platforms like Polymarket, the probability of Bitcoin reaching new all-time highs this month has dropped drastically. Bets on whether BTC will surpass $100,000 before January's end have seen a notable percentage decline, reflecting a market shift from euphoria toward consolidation or a potential technical correction.
CryptoQuant CEO Ki Young Ju reinforced this outlook, stating that fresh capital inflows into Bitcoin have dried up. He argued that money has rotated into equities and commodities, leading to a "boring sideways" phase for the next several months rather than a dramatic sell-off. Ju dismissed fears of a major crash, pointing to structural changes like long-term institutional ownership, such as Strategy's 673,000 BTC stash, which he believes is unlikely to be sold in a meaningful way.
Technical factors are also contributing to the slowdown. Bitcoin failed to consolidate above the $95,000 resistance level in early January, leading speculators to close long positions over fears of a correction toward $88,000. The global macroeconomic environment, including uncertainty around Federal Reserve decisions and geopolitical tensions, is further limiting risk appetite.
On-chain data supports the view of a grinding phase. Analyst CryptoZeno noted that Bitcoin's Net Unrealized Profit/Loss is near the 0.3 level, a historical holding range. Glassnode's Week On-Chain report from January 7 described a "cleaner market structure" for 2026, with cooled profit-taking, cleared derivatives positioning, and uneven but positive U.S. spot ETF flows. While Bitwise CIO Matt Hougan sees potential for continued recovery if regulatory uncertainty eases, other voices like Doctor Profit warn of longer-term downside risks.
