The Bitcoin cycle in 2026 is being primarily driven by macroeconomic factors, including shifting liquidity conditions and central bank policies, rather than the traditional halving narrative blog.kraken.com . Emerging on-chain innovation is also playing a role, but the dominant force remains global monetary trends blog.kraken.com .

Macro Correlation

As Bitcoin's market cap has grown, its correlation with traditional risk assets has strengthened, making it more sensitive to Federal Reserve interest rate decisions and global liquidity injections blog.kraken.com .