Bitcoin and the broader crypto market is off to a strong start in 2026, with analysts linking the buoyant sentiment to fresh New Year allocations, safe-haven bids and other factors.
Bitcoin was trading near $93,700 on Tuesday, up about 1% in 24 hours and more than 7% since January 1. Ether rose nearly 2% to $3,224 and is up about 9% over the same period. led large caps, jumping nearly 13% on the day to $2.40 and nearly 29% on the week, while solana increased 12% and up about 23% over the past week.
Subsidy for tax sales
The rise follows dismal price action through the end of December, with tax-related sales and year-end book-cleaning coming to the upside, particularly during US hours. The US-based holders reportedly liquidated their crypto holdings at a loss to offset capital gains and reduce overall tax liability. Investors typically take losses on underperforming assets to lower taxes on profitable sales.
That pressure has faded, allowing for a rebound, according to observers at Singapore-based QCP Capital.
“Crypto’s alignment with broader risk assets looks less like a fluke and more like a regime shift to start the year, helped by year-end tax loss harvesting fading and policy freedom back on the radar,” the firm said in a market update Monday.
BTC’s ongoing price rise is in line with the positive sentiment on Wall Street. On Monday, U.S. stocks rose as the U.S. military strike on Venezuela lifted oil stocks and renewed AI optimism lifted tech stocks. BTC and the broader crypto market are known to follow developments in tech stocks closely.
Have bid
The US attack on Venezuela likely added a bid for a safe haven for bitcoin and other traditional safe-haven assets such as gold.
“This spot move is likely a mix of fresh risk budgets being triggered, rotation from outperforming assets and a flow into hard assets on Venezuela’s headlines,” Jeff Anderson, head of Asia at STS Digital told CoinDesk.
Speculation that Venezuelan oil supply could increase under US guidance could help the bullish sentiment. All other things being equal, higher supply could lower oil prices and generate a disinflationary impulse that would allow central banks to cut interest rates quickly.
“Washington’s Venezuela shock may serve as a short-term catalyst for BTC. In addition to the disinflationary impulse from lower oil prices, market chatter has revived claims that Venezuela may control a significant “shadow” BTC reserve, potentially comparable to Strategy’s holdings. These claims are unconfirmed,” QCP Capital said.
ETF inflows and bullish option positioning
US-listed spot ETFs have launched in 2026 with strong inflows, signaling the end of a two-month de-risking period that saw institutions move billions and send BTC and the broader crypto market lower.
The 11 funds have cumulatively recorded net inflows of more than $1 billion in the first two trading days of the week, according to data source SoSoValue.
“The final trading days of 2025 and the opening sessions of 2026 delivered a cautious but constructive reset for the crypto markets. Bitcoin closed the year consolidating just below key resistance ($92,000) while institutional flows turned decisively positive for the first time in weeks. Spot ETF inflows returned across Bitcoin, Ethereum, stabilized XRP and stabilized XRP prices,” Misir, head of research, BRN, said in an email.
These inflows add to the bullish momentum, although it remains to be seen whether they will continue.
“Upcoming ETF flow prints will be critical in determining whether this nascent recovery can attract fresh institutional capital or whether caution continues to dominate positioning,” analysts at Bitfinex told CoinDesk.
Experienced traders are positioning themselves for a continued price rise in the short term. Data from options exchange Deribit shows traders snapping up call options at the $100,000 strike in anticipation of a six-figure price increase.
“Call activity is picking up across both majors. Blocks are showing buyers going through the guts: BTC Jan/Feb 98,000-100,000 calls, ETH 3200-3400 calls for January, plus some March chokes,” Jake Ostrovskis, head of OTC at Wintermute, said in an email. “The size is not huge, but the direction is consistent – building on the large $100,000 strike interest marked last week.”
Low liquidity is still a problem
Despite constructive price action, some observers continue to flag “thin liquidity” as a source of risk.
Liquidity refers to the market’s ability to absorb large buy and sell orders at stable prices. Weak or thin liquidity means that a large order can have an overall impact on the spot price, leading to erratic price movements that often coincide.
According to Vikram Subburaj, CEO of the India-based Giottus exchange, spot market volume remains at multi-year lows, indicating weak liquidity.
“The short-term structure has turned from weakness to strength. That said, spot volume is at its lowest since late 2023 and order books remain shallow. This makes the rally more sensitive to marginal flows and increases the risk of sharp extensions or sharp pullbacks. The setup is constructive, but conviction is not yet broad-based in a sub-email.
As desks return, ETF demand has also stabilized, and traders say that kind of base bidding is important when spot books are thin.
