Author: Go2Mars Web3 Research
This article aims to provide an analytical framework to help understand that the current "return to value" is not a helpless sigh at the end of a bear market, but the necessary growing pains before the birth of the next generation of trusted financial infrastructure.
Over the past two years, the crypto industry has experienced Bitcoin's evolution from a speculative asset and cyclical instrument, a reservoir during monetary easing, to now becoming a non-sovereign macro anchor asset and a strategic reserve option; stablecoins have also transformed from mere mediums for crypto speculation to on-chain dollars that are still developing healthily, facilitating cross-border on-chain payment settlements, and providing the world with a low-threshold channel to access dollars.
In stark contrast is the altcoin market. So far, the vast majority of crypto projects have been proven false, with the glorious days of some projects most likely never to return; more broadly, projects have drowned in their preparation stages due to the industry's bleak conditions.
The tide of liquidity has receded, and speculative narratives have become increasingly scarce and dull. However, I believe this is a normal transition cycle for the blockchain industry's development—a healthy清算 (liquidation/clearing) phase of the crypto bubble and fantasies. After hitting bottom, the crypto industry will slowly emerge from the gloom.
Institutional investors' confidence in the 2026 crypto industry has significantly increased. According to EY's 2025 survey, nearly 80% of respondents expect cryptocurrency prices to rise, and nearly 70% see it as the biggest opportunity to obtain attractive risk-adjusted returns.
1. The Emergence of Blockchain-Native Finance
1.1 Beyond RWA: From "Auxiliary Tool" to the Core of "Credit Efficiency"
The current essence of RWA is still bundling assets and debts from the traditional financial system onto the chain. This model is acceptable but only serves as an auxiliary tool to traditional finance. In reality, blockchain's functionality far exceeds this. The essence of modern financial competition is not the scale of capital, but "credit efficiency."
Superficially, the competition among financial systems is about:
(1) Amount of capital
(2) Level of interest rates
(3) Market size
But the underlying logic is: whether a system can organize credit with lower costs, less friction, and less abuse. Whoever can produce, price, and清算 credit more efficiently holds the long-term advantage.
1.2 The Flaw of Traditional Finance: "Personalized + Power-Based" Credit Model
In the traditional system, credit relies on:
(1) Central banks
(2) Commercial banks
(3) Government backing
(4) Law and enforcement by force.
This leads to a fundamental problem: credit is not neutral but can be manipulated. Those who hold power can decide the flow of funds, enjoy subsidies, and socialize losses.
1.3 "Trustless" Collaboration: Locking Power into Rules
The spirit of blockchain is to establish a system that enables people to collaborate without needing to trust each other.
Blockchain, through:
(1) Cryptography
(2) Consensus mechanisms
(3) Immutable ledgers
constructs a全新的 (brand new) trust model, locking power into rules, turning ownership from permission into fact. For the first time, it builds a "worst-case human nature assumption" into the system itself. Even if human problems exist, it still constructs a credible order. This is a dimensional打击 (blow/strike) to the traditional credit system.
Blockchain's true advantage lies in its underlying system's restructuring of credit organization methods. The spirit of blockchain determines the form of the system, the form of the system determines the efficiency of the mechanisms, and the efficiency of the mechanisms ultimately manifests as advantages in cost, speed, and accessibility at the user level.
(1) Lower financial service costs
(2) More efficient financial service speeds
(3) Elimination of geographical access and some barriers
1.4 Path: From DeFi's Starting Point to the Compliant Road of Legislative Breakout
Cryptocurrencies have moved from 'scams' to mainstream. Large-scale participation by traditional financial institutions in the crypto industry has been accompanied by continuous attempts at on-chain native finance and pushes for legal regulation. The rise of DeFi products in the summer of '21, the earliest congressional attempts at legislation for crypto assets starting in '23, RWA entering the mainstream narrative in '24, to the "legislative breakout year" of 2025. 2026 holds hope for seeing the true starting point of on-chain finance for the first time.
https://transak.com/blog/the-clarity-act#the-clarity-act-timeline
2025 US Government Legislative Timeline for the Cryptocurrency Industry
2. The Return of Token Value
In the early stages of the crypto industry, a large number of tokens achieved astonishing market cap growth without any real earnings, or even a clear value capture path.
Why could early tokens rise without "real earnings"?
2.1 The Market Priced Not Cash Flow, but "Future Credit"
In the industry's infancy, the core pricing basis for tokens was not:
Dividends Earnings Buybacks
But future credit:
1. The possibility of becoming infrastructure in the future
2. The potential to capture value in the future
3. The potential to be recognized by institutions, users, and capital in the future
Tokens were more like "options on future institutional status and network effects." The exercise condition for this option was the collective cognition and belief of the market.
During the industry's explosive growth phase, as long as enough participants believed a narrative—believed this public chain would become the next financial settlement layer, believed this DeFi protocol could capture the ecosystem's liquidity, believed its team and community had the ability to modify tokenomics at some future point to achieve value capture—then this shared belief itself became a "self-fulfilling prophecy."
Capital would flood in based on this belief, driving up prices; rising prices, in turn, reinforced the belief, attracting more capital. In this reflexive cycle, the token提前兑现 (cashed in early) on that option value of "future credit." It was essentially a game of attention, consensus, and coordination. Tokens were the chips in this game, and the option value was determined by the participation and frenzy of the game.
2.2 Narrative Dividend and Cognitive Gap Driven Early Super Premiums
In the past few years, blockchain narratives still held high novelty:
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Financial Infrastructure Narrative (DeFi Primitive): Terra Uniswap Synthetix Curve
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Application Narrative: NFT SocialFi GameFi
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Platform Narrative: Layer2 Public Chains
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Blockchain Interconnection Infrastructure Narrative: Cosmos Polkadot
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Web3 Middleware Infrastructure Narrative: Oracles Cross-chain Bridges Sequencers Modularity Wallets and Account Abstraction
These narratives themselves could generate cognitive dividends, attracting incremental funds. Brand new narratives have a natural advantage at the cognitive level because they create "attention asymmetry + comprehension asymmetry," leading to early pricing advantages.
1 Scarcity of Attention Effect
Human attention is extremely limited.
When a narrative appears for the first time: It is更容易被注意到 (easier to notice) It is更容易被 (easier to be) amplified by media, KOLs, and capital. Uniswap, with extremely low cognitive cost, broke the traditional notion that no market maker means no liquidity. The price could be determined by an x*y=k formula. This "counterintuitive but explainable" model created a strong memory and传播效应 (propagation effect).
2 Cognitive Framework Vacuum
When a field is new:
1) There is no unified valuation model
2) There are no success/failure precedents
3) There is no "reasonable price anchor" CosmosHub succeeded for years based on the narrative of being the "golden shovel for Cosmos ecosystem projects" precisely because it lacked fundamentals.
Amid an environment of泛滥的宏观流动性 (flooded macro liquidity), the process of participants flowing into the crypto market combined with the early narrative红利 (dividends). Due to market reflexivity, we witnessed the glory of various projects starting in 2021. Many capable young people cashed in their cognition through the cryptocurrency market, achieving wealth freedom legends.
Now, macro liquidity and market conditions can no longer sustain the previous door to speculative狂欢 (carnival). The vast majority of narratives have been proven false, and the vast majority of tokens have gone to zero or nearly zero.
Current cryptocurrency participants are gradually realizing that the vast majority of "shitcoins" truly only have short-term market gaming value without actual value support.
Future cryptocurrency projects, if they want to gain investors' 'faith,' need to present products capable of long-term profitability and tokens with value capture.
The market has already begun punishing inflation and empty narratives over these past few years. Bears who selected落后叙事 (backward narratives) and inferior token economics have slowly transferred money from many long-term bullish investors willing to provide liquidity to themselves.
Current price decline from all-time high for leading projects in various narrative sectors within the top 150 crypto tokens by market cap
Currently, whether viewed from macro liquidity conditions or market structure, this speculative pricing framework centered on narratives and expectations is difficult to sustain. As monetary conditions tighten, risk appetite recedes, and narrative liquidity becomes structurally diluted, the vast majority of narratives that the market had placed high hopes on over the past few years have gradually been proven false. The prices of绝大多数缺乏真实产品能力与可持续商业模式的代币 (the vast majority of tokens lacking real product capability and sustainable business models) have experienced long-term declines, with some projects even approaching zero.
In a global macro environment of highly宽松的流动性 (loose liquidity), risk appetite significantly increased, and a large number of market participants flooded into the crypto asset market. This process叠加 (overlapped) with the industry's early, not yet fully understood narrative红利 (dividends). Amplified by price reflexivity, we began witnessing a large number of crypto projects achieving rapid market cap inflation in a short time starting in 2021.
At this stage, the crypto market essentially provided a venue for those with cognitive领先 (leadership) to quickly monetize information advantages and judgment. Some capable early participants thus achieved wealth freedom.
Against this background, market participants' perception of crypto assets is undergoing a structural change. More and more investors are beginning to realize that the value of the vast majority of tokens supported only by short-term sentiment and gaming logic exists only in specific speculative phases.
Future crypto projects, if they hope to regain investors' long-term trust, must prove they possess stable and sustainable product revenue capabilities and achieve effective capture of protocol value through clear tokenomics design.
In fact, the market has already begun systematically punishing token models characterized by high inflation, weak value capture, and driven by落后叙事 (backward narratives) over the past few years. In this process, pricing power has gradually shifted from "future credit" and vague expectations towards the evaluation of real fundamentals, profitability, and cash flow sustainability. The crypto asset market is transitioning from an early narrative-driven stage to a more fundamentally priced stage.
3 Privacy is Shifting from "Edge Feature" to "Core Infrastructure"
In the early stages of the crypto industry, privacy was more often seen as an ideological demand or a niche feature:
Anonymous transactions, censorship resistance, personal freedom. Such demands are real, but for a long time, they have not been core metrics in mainstream blockchain competition.
3.1 From an investment perspective, the privacy track simultaneously satisfies the characteristics of being a trend for blockchain's next development
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Strongly related to institutional adoption and government legislation worldwide. Privacy shifting from "full anonymity" to "composable, auditable" is a real-world rigid demand.
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Strong network effects + High migration costs. Difficult to replicate and commoditize.
As crypto assets gradually move towards Real-World Finance, the positioning of privacy has undergone a fundamental change: privacy is no longer a question of "whether it is needed," but rather "whether it is available."
As a16z pointed out in its 2026 outlook:
Privacy is the one feature that’s critical for the world’s finance to move onchain — and also the one feature that most blockchains lack.
Privacy is evolving from an ancillary capability to a decisive moat in chain-level competition.
Privacy transaction volume entered a period of rapid growth starting Q4 2025
3.2Why is Privacy a Necessary Condition for "Finance Moving On-Chain"?
Real-world finance cannot operate on a "fully transparent" ledger.
The transparency of public blockchains was an advantage in the early days, but it becomes a fatal flaw in real financial scenarios:
1) Enterprises cannot公开所有交易对手与现金流 (publicly disclose all counterparties and cash flow)
2) Institutions cannot暴露仓位、交易策略、资金结构 (expose positions, trading strategies, capital structure)
3) Users cannot accept permanently traceable asset behavior history
Therefore: Without privacy, the chain can only carry speculation; With privacy, the chain can carry finance. This is also why stablecoins, RWA, and institutional DeFi, when developed to a certain stage, will inevitably point to a privacy layer.
Compared to ordinary public chains, privacy-enabled chains, by hiding transaction amounts, account relationships, and behavior paths, make users' on-chain state non-replicable and not easily migratable, thereby significantly increasing migration costs and potential exposure risks.
People are extremely sensitive to privacy leaks cognitively. Therefore, once entering a privacy ecosystem, they tend to maintain the status quo and complete as many financial activities as possible on the same chain.
This "user stickiness"叠加 (combined with) network effects causes privacy chains to form a Winner-Take-Most structure: the larger the ecosystem, the more it attracts users and capital, forming a positive feedback loop.
Meanwhile, privacy also introduces obstacles like incomplete information games and weak cross-chain connectivity, making advantages difficult to replicate or be replaced by other chains. Overall, privacy is not just a functional difference but a core mechanism that changes market structure, locks in value, and forms long-term competitive advantages. Therefore, it is highly likely that a few high-quality privacy chains will dominate important infrastructure and trading ecosystems in the crypto market in the future.
Privacy is moving from the ideological fringe of cryptocurrency to the core of financial infrastructure. In an era where performance competition fails and narrative dividends fade, privacy may become one of the strongest and most enduring moats in the blockchain world.
4. AI and Blockchain Integration: From "Pseudo-Combination" to "True Paradigm"
In past cycles, "AI+Crypto" has appeared multiple times as a speculative narrative. These attempts were mostly superficial: either强行地 (forcibly) fitting AI into a Web3 shell, creating "AI算力币 (compute power coins)" with no real demand; or simply using blockchain as a storage tool for AI data. The essence of this "pseudo-combination" was a shallow拼接 (stitching together) of two transformative technologies, failing to touch upon their core complementarity—AI lacks a trusted economic and collaboration layer, while blockchain lacks intelligence and adaptive capabilities.
However, in 2026, we are witnessing this integration elevate from a "marketing concept" to a "foundational paradigm." The core shift is: AI is no longer just an application on the blockchain but is becoming the "intelligent layer" of blockchain protocols; simultaneously, blockchain is no longer just a tool for AI but is evolving into the "trust and settlement底层 (base layer)" for AI agents to participate in socio-economic activities on a large scale. This integration will unfold along two profound directions:
4.1 AI as the "Intelligent Engine" at the Protocol Layer
Future blockchain protocols will embed AI as a core component, endowing them with dynamic optimization and autonomous management capabilities:
1) In DeFi: Lending protocols can use AI models to analyze on-chain/off-chain data in real-time, dynamically adjusting interest rates and liquidation thresholds to achieve global optimization of risk and capital efficiency.
2) In Security and Governance: AI can become a "on-chain immune system" that monitors smart contract vulnerabilities and detects abnormal transaction patterns in real-time. In DAO governance, AI agents can automatically execute complex resolutions or simulate the long-term impact of proposals, assisting humans in making wiser decisions.
4.2 Blockchain as the "Institutional Foundation" for the AI Economy
When massive numbers of AI agents begin to replace humans in transactions, collaboration, and value creation, they need a native, trusted, and automated "machine economy" environment. This is where blockchain's irreplaceable advantage lies:
1) Identity and Trust (KYA): Traditional "Know Your Customer" (KYC) cannot apply to machines. Blockchain can establish a tamper-proof system of identity, reputation, and historical records for each AI agent through cryptographic credentials, achieving "Know Your Agent" (KYA), which is a prerequisite for large-scale machine collaboration.
2) Payment and Settlement: High-frequency, small-amount, 7x24 micro-payments between AI agents (e.g., paying for data fees, API call fees) require a permissionless, globally settled payment rail. Crypto-native currencies and smart contracts are the perfect foundational layer for building this Machine-Native Finance.
3) Data and Value Attribution: Blockchain can ensure transparent sourcing and clear copyright of data used for AI training, and through tokenization, enable data contributors to directly capture value, thereby building a fairer and more efficient trusted data market than the current centralized models.
4.3 How Will This Change the Industry Rules?
This deep integration essentially answers a fundamental question: In a future world with increasingly high agent density, how will value be generated, flow, and be attributed? The answer points to a composite ecosystem where blockchain provides the institutional framework and AI drives economic growth. This is not just a technological combination but an innovation in economic and governance models. It detaches the crypto industry from the single narrative of "financial speculation" and truly anchors it to the core engine driving the next productivity revolution.
5. 2026 New Year Outlook: Change the Playbook, Earn Steadily
Simply put, the crypto industry is undergoing a fundamental transformation. The old玩法 (playbook) of getting rich quickly by telling stories and hyping concepts is no longer viable. 2026 will be the beginning of a new, pragmatic phase.
5.1 Old Playbook Fails, New Rules Emerge
The market has proven with action: Tokens that simply make big promises and print money无限地 (infinitely) will be mercilessly abandoned.
People are increasingly看重 (valuing) whether a project actually has revenue, users, and the ability to make money.
This is like the tide going out, revealing who is swimming naked.
Now, the water has receded, and the industry has reached the age where it must put on clothes and work steadily.
5.2Predicted Development Directions for Cryptocurrency in the New Phase
The four major trends elaborated in this article collectively mark that a profound systemic migration in the crypto industry is entering a substantive stage. 2026 will be the critical starting point for this migration.
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Institutional Layer (Blockchain-Native Finance): Reconstructing credit through code and consensus, providing a foundational framework with lower costs, less friction, and more open access. The US "path to compliance" is the inevitable process of this new system demanding mainstream recognition.
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Asset Layer (Token Value Return): Tokens will gradually move past this phase of极度投机性"溢价的看涨期权" (extremely speculative "premium call options") and gradually become "stock-like." Their value will depend more and more on the project's real profitability, not on far-fetched stories.
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Security Layer (Privacy as Core Infrastructure): When the chain starts handling real business and finance, privacy is like a bank's vault, shifting from an "optional accessory" to "core infrastructure." Privacy becomes a prerequisite for safeguarding business secrets and complex financial logic operating on-chain, the key that unlocks blockchain's potential.
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Intelligence Layer (AI and Blockchain Integration): Blockchain provides a trusted economic layer for AI agents; AI makes blockchain protocols smarter. The "machine economy"催生 (spawned) by their integration will be the core of future growth.
For investors, this means a shift in logic: from chasing short-term narratives to identifying the builders of long-term structural pillars. As regulation clarifies and evaluation rationalizes, the industry will emerge from the ruins of valuation disillusionment and enter a construction周期 (cycle) to lay the foundation for the digital future. The noisy "gold rush" is cooling down, while the silent "city building" has just begun. In 2026, we may stand at a healthier and more sustainable new starting point.
Disclaimer
The content of this article is written by the G2M team and is solely market analysis and trend discussion based on public information, not constituting any form of investment advice or financial advisory opinion.
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Not Investment Advice: All views, predictions, and analyses in this article are for research purposes only and are for reference. The cryptocurrency and digital asset market is highly volatile, and investment carries significant risks, including loss of principal. Before making any investment decision, you should make an independent judgment based on your own financial situation and risk tolerance, and seek advice from a professional independent financial advisor.
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Risk Warning: The cryptocurrency industry faces various uncertainties including technological evolution, market competition, regulatory policy changes, and network security. Past performance is not indicative of future results. Any projects, technologies, or assets mentioned in the article are not guaranteed for their future performance or security.
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Information Sources: This article strives to cite and reference public information and research from reliable channels, but we make no express or implied warranty regarding its accuracy, completeness, or timeliness. Market information changes rapidly, please verify the latest situation before making decisions.
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Interest Disclosure: The authors and publishers of this article may or may not have any interest relationship with certain projects, institutions, or assets mentioned herein, and may or may not hold the assets mentioned. The publication of this article does not constitute any conflict of interest.
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