Debt crisis spurs liquidity easing; can cryptocurrencies usher in a new bull market by 2026?

Market analysis firm Delphi Digital recently proposed an interesting viewpoint: the expansion of global debt could become a driving force for risk assets like cryptocurrencies in 2026. The logic is not complicated, but the underlying economic issues involved warrant in-depth understanding.

The Inevitable Choice Under Debt Dilemma

According to the latest news, Delphi Digital’s Head of Market, Jason, pointed out the core dilemma facing the current global economy. Fiscal deficits in developed countries have already accounted for 4%-7% of GDP, and the global debt-to-GDP ratio continues to rise, with bond yields reaching multi-decade highs. These data reflect a reality: governments and corporations have accumulated enormous debt levels.

Faced with this situation, policymakers encounter a seemingly paradoxical choice: to address high debt levels, the only feasible solution is to issue more debt. This may seem counterintuitive, but in the current economic environment, it has become an inevitable move.

The Logic Chain of Liquidity Expansion

The core of this viewpoint lies in the transmission mechanism of liquidity:

• Increased debt issuance means central banks need to absorb more bonds
• Central banks’ balance sheets expand, market liquidity increases accordingly
• Ample liquidity seeks investment outlets, including risk assets
• Cryptocurrencies, as high-risk high-reward assets, could become a significant carrier of liquidity

This logic has not been unprecedented in history. During the quantitative easing period after the 2008 financial crisis, the release of liquidity indeed drove up risk assets, including cryptocurrencies.

Credibility Assessment of the Expectation

The persuasiveness of this viewpoint mainly comes from several aspects:

First, the data support is substantial. Developed countries’ fiscal deficits of 4%-7%, rising debt-to-GDP ratios, and other macroeconomic data are verifiable, and this trend is expected to continue at least until 2027.

Second, the professional background of the proposer. Delphi Digital is a well-known analysis institution in the crypto market, and Jason’s views represent the thinking of market professionals rather than baseless speculation.

Third, logical consistency. In an environment of high debt and high interest rates, increasing debt issuance is indeed a possible policy choice for policymakers.

Risks to Watch Out For

However, this expectation also carries uncertainties. Policymakers might adopt other measures, such as raising taxes, cutting expenditures, or allowing some debt defaults. The actual effect of liquidity release also depends on the implementation strength of policies. Moreover, the crypto market itself is highly volatile; increased liquidity does not necessarily guarantee a bull market.

Summary

The transmission chain of debt–liquidity–asset prices is valid in economics, and current global economic data indeed point toward debt expansion. From this perspective, the possibility of cryptocurrencies gaining liquidity support in 2026 exists. But this is just one of many influencing factors; the market’s ultimate performance will also depend on policy execution, technological development, market sentiment, and other variables. Investors should remain rational when considering such macro analyses and avoid over-relying on a single logic.