Bank of America Major Forecast: By 2026, the market may see a $600 billion liquidity injection. How will the crypto market respond?

Recently, Bank of America analyst Michael Hartnett released a highly market-focused forecast in his research report: by 2026, the global market could see approximately $600 billion (0.6 trillion USD) in additional liquidity support. This prediction quickly sparked widespread discussion within the financial and crypto communities, with many analysts linking it to potential “quantitative easing” effects and expecting it to have a profound impact on risk assets, especially the cryptocurrency market. As a trading platform with long-term deep involvement in the crypto space, Gate will explore this Bank of America liquidity forecast report with you in depth and further analyze the overall market liquidity prospects under the background of increased liquidity expectations in 2026.

Core of the Forecast: What is the $600 Billion Liquidity Support?

According to the Bank of America report, this potential massive liquidity may mainly originate from several sources:

• Increased issuance of government bonds: Governments expanding debt issuance to meet fiscal needs or stimulate the economy.
• Purchases of Mortgage-Backed Securities (MBS): Asset purchase activities by relevant institutions in the market.
• Reinvestment of maturing assets: Reinvesting funds from maturing assets back into the market.

The report explicitly states that some market participants tend to interpret this process as a form of “quantitative easing” (QE). Historically, large-scale liquidity injections often significantly lower market interest rates, push up asset prices, and lead funds to seek higher returns—this has been a key macro backdrop for several past crypto bull markets.

However, there are also views (such as from well-known crypto analyst Titan of Crypto) cautiously defining this as “liquidity support,” distinguishing it from the Federal Reserve’s formal expansion of its balance sheet through “quantitative easing.” Regardless of the terminology, the scale of potential new liquidity alone is enough to prompt investors to reassess their asset allocation strategies for the coming years.

Historical Reflection: The Strong Link Between Liquidity Waves and Crypto Markets

The cryptocurrency market, especially Bitcoin, is often regarded by some investors as a “global liquidity barometer.” During the low-interest and QE era after the 2008 financial crisis, as well as during the unprecedented monetary easing measures launched in 2020 to combat the pandemic, Bitcoin experienced explosive growth in both price and attention.

Increased liquidity generally implies:

• Concerns over the dilution of fiat currency purchasing power: prompting investors to turn to assets with limited supply and inflation resistance.
• Elevated risk appetite: abundant funds are more willing to flow into stocks, emerging tech assets, and high-risk, high-reward sectors like cryptocurrencies.
• The “reservoir” effect of the financial system: when traditional markets face valuation pressures due to excess liquidity, some overflow funds seek new growth narratives, with crypto often being one of the destinations.

Currently, Bitcoin is in a new cycle after its fourth halving. According to Gate market data, as of January 20, 2026, Bitcoin (BTC) is priced at $92,622.9, with a market cap of $1.84 trillion, accounting for 56.42% of the entire crypto market. Meanwhile, Ethereum (ETH) is priced at $3,188.06, with a market cap of $387.58 billion. The market cap scale of mainstream assets is now vastly different from before, and their sensitivity and feedback mechanisms to macro liquidity are more complex.

Outlook for 2026: Opportunities and Challenges Under the Wind of Liquidity

If the Bank of America forecast proves true, the arrival of increased liquidity in 2026 could create a critical macro window for the crypto market.

Impact on Mainstream Crypto Assets

• Bitcoin (BTC): As “digital gold,” its store-of-value narrative could be reinforced in an environment of abundant liquidity and potential inflation. Its large market cap also means that more capital is needed to drive significant price increases, but an improved liquidity environment is undoubtedly a positive foundation.
• Ethereum (ETH): As a smart contract platform and the core of the Web3 ecosystem, Ethereum’s development depends more on real-world applications and ecosystem growth. Improved liquidity conditions could lower capital costs for developers and users, boosting activity in DeFi, NFTs, Layer2, and other sectors within its ecosystem, supporting its value from a fundamental perspective.

Impact on the Broader Crypto Ecosystem

Liquidity injections rarely distribute evenly. History shows that during bull cycles, funds tend to flow sequentially or simultaneously into:

• Mainstream coins (like BTC, ETH)
• Large-cap altcoins
• Emerging sectors and narratives (such as AI+Web3, DePIN, RWA)
• Meme coins and high-volatility assets

A healthy market liquidity outlook helps enhance overall market depth and activity, reduces trading friction, and may attract more institutional and individual investors from traditional sectors to enter crypto through compliant platforms like Gate.

Preparing for Potential Market Changes on Gate

In the face of possible macro shifts, rational investors can focus on the following aspects, supported by the comprehensive tools and services Gate offers:

• Information access and learning: Gate Research Institute and Gate Learn platform continuously provide in-depth market analysis, industry research reports, and easy-to-understand educational content to help users grasp complex macro trends and micro-project developments.
• Diversified asset allocation: Gate’s spot market supports over 1,700 trading pairs, allowing users to conveniently allocate assets from mainstream coins to emerging potential projects on one platform, diversifying risk and capturing opportunities across different sectors.
• Flexible trading strategies:
  • Dollar-cost averaging (DCA): For assets with long-term bullish outlooks, DCA can smooth out costs.
  • Derivative trading (use cautiously): Gate’s derivatives products offer various leverage options, suitable for experienced traders who can tolerate high risks and want to amplify gains in clear trend environments (with strict risk management).
• Monitoring market sentiment and capital flows: Gate’s trading volume, price charts, and rich market data provide intuitive windows into capital rotation and market sentiment.

Conclusion

The Bank of America forecast of $600 billion in liquidity support by 2026 paints a noteworthy picture of the global financial landscape over the next two years. While the forecast itself is not a certainty, and its transmission to the crypto market’s path and strength will be influenced by various factors (such as regulatory developments, technological breakthroughs, geopolitical issues), it undeniably reminds us that macro liquidity remains one of the core variables in crypto asset pricing.

Finding relatively certain trends amid uncertainty is an art of investing. Regardless of how the market evolves, Gate will continue to strive to create a safe, reliable, and fully functional trading environment, providing users with cutting-edge market insights and efficient trading tools, accompanying every user to navigate cycles and respond calmly to market fluctuations in the world of cryptocurrencies.