Crypto Faces a Challenging 2026, Says Barclays, Absent Significant Market Drivers

Investor enthusiasm for crypto is fading, and spot trading volumes are cooling, according to a year-end report from Barclays.

The bank expects a muted 2026 for digital assets, with trading activity trending lower and few clear growth catalysts. Exchanges like Coinbase (COIN) and Robinhood (HOOD), which benefited from past retail-driven bull runs, are facing a calmer market as spot volumes—key revenue drivers—remain soft.

“Spot crypto trading volumes […] appear to be trending towards a down-year in FY26, and it is not clear to us what might reverse this trend,” the report said.

Historically, major market events such as product launches, policy announcements, or political shifts have driven bursts of activity, including the March 2024 spot bitcoin ETF inflows and the pro-crypto U.S. presidential win in November. In their absence, Barclays sees little structural growth.

Regulation could offer a potential boost. The proposed CLARITY Act, aimed at clarifying the line between digital commodities and securities and defining SEC vs. CFTC oversight, may reduce uncertainty and enable new product launches, particularly in tokenized assets.

Coinbase continues to expand into derivatives and tokenized equity trading, but declining spot volumes and rising costs pose headwinds. Barclays lowered COIN’s price target to $291, citing a more conservative earnings outlook.

Tokenization remains an early-stage trend, attracting attention from BlackRock (BLK), Robinhood, and other firms, but Barclays expects limited impact on 2026 earnings.

Despite a slightly more favorable U.S. political environment, much of the optimism appears priced in. Overall, 2026 may be a transitional year for crypto, with companies focusing on long-term bets in compliance and tokenized finance amid subdued market activity.