McGlone Flags Caution for Bitcoin in 2026 as Market Faces Deflationary Pressures

Bitcoin has been trading with limited movement around $87,000, reflecting a quiet phase in the market. Mike McGlone, senior macro strategist at Bloomberg Intelligence, has adopted a cautious stance, warning that the cryptocurrency may be entering a post-inflation deflationary period that could change its risk profile and make long-term gains less likely. While McGlone previously held a constructive outlook on Bitcoin, he now recommends that investors approach future rebounds in 2026 as potential selling points rather than buying opportunities.

Bitcoin Falls Behind Gold and Silver

McGlone highlights that the economic conditions driving Bitcoin’s rapid gains since 2020 are no longer in effect. The previous climate, shaped by easy access to capital and high-risk investment activity, is now moving into a period of tightening market pressures. In this context, risk assets—including Bitcoin—face heightened vulnerability.

At the same time, the strategist points to a growing gap between Bitcoin and traditional safe-haven assets. While gold continues to reach record highs, Bitcoin has struggled to regain momentum. McGlone interprets this divergence as a sign that gold is moving ahead in anticipation of broader market challenges, rather than indicating strength in the crypto space.

This divergence is clear in recent commodity performance. Gold futures recently surpassed $5,100 per ounce for the first time, while silver has surged even more sharply. Over roughly 13 months, silver has gained about 270%, compared with an 11% decline for Bitcoin, pushing silver’s market capitalization to nearly three and a half times that of the cryptocurrency.

Bitcoin Mirrors Stock Markets

According to McGlone, Bitcoin is behaving less like an independent hedge and more like equities. Rather than moving counter to traditional financial markets, it increasingly tracks stock market trends. This alignment, he explains, leaves Bitcoin vulnerable to the same economic downturns and market strains that typically affect higher-risk assets.

Looking at 2026, McGlone outlines multiple possible outcomes for BTC, with downside risks appearing more prominent than upside opportunities.

• In the most severe case, Bitcoin could drop toward $10,000 if its price returns to levels seen before the speculative mania, a range McGlone considers typical based on historical charts. He describes this as a low-probability risk but emphasizes that it could materialize under a severe deflationary shock.
• In a milder scenario, the cryptocurrency might retreat to roughly $50,000 if stock markets remain unsettled but avoid a major collapse, reflecting the type of correction that often follows periods of rapid speculative gains.
• On the upside, he identifies $100,000 as a key resistance point, noting that Bitcoin’s outlook remains fragile unless it can sustain a move above this threshold.

On-chain data from Glassnode, providing a snapshot of current market trends, shows Bitcoin trading around $87,000, with short-term holders carrying a cost basis of $96.5K, active investors averaging $87.5K, the true market mean at $80.7K, and the realized price at $56.0K. While the cryptocurrency is trading close to current investor averages, these metrics suggest that its alignment with the broader market remains under pressure.

Preparing for a Defensive 2026

Shifting focus to the wider financial environment, McGlone highlights potential risks. He notes that a market slowdown is possible as high-risk investments are unwound, drawing parallels with conditions before the 1929 market top and the 2008 financial crisis. In such a scenario, digital assets could worsen losses rather than act as a safeguard.

He recommends a cautious approach for 2026, prioritizing safer options like U.S. Treasurys and cash amid a slowing market. He sees the current conditions not as a temporary pause in a bull run but as the start of a broader market correction.