By Tyler Warner
6 min read
Morning Minute is a daily newsletter written by Tyler Warner. The analysis and opinions expressed are his own and do not necessarily reflect those of Decrypt. Subscribe to the Morning Minute on Substack.
GM!
Today’s top news:
One of the biggest players in traditional finance just published a 26-page report on Bitcoin and digital assets.
And their conclusion is that Bitcoin’s hurdles and headwinds are only making it stronger.
Fidelity Digital Assets released its 2026 Look Ahead report, taking a deep dive through some of Bitcoin’s issues and dropping a future outlook.
On the technical side, Fidelity pushed back hard on claims that Ordinals, inscriptions, or OP_RETURN expansion are “breaking” Bitcoin.
On-chain data shows block space demand stayed low throughout 2025, even after multiple waves of so-called “spam.”
Fidelity argues that if demand does rise, higher fees are a healthy outcome, strengthening miner economics rather than harming usability.
The report also addressed internal governance tensions (Core vs. Knots), warning that attempts to censor non-financial transactions via consensus changes would undermine Bitcoin’s core properties: immutability, decentralization, and censorship resistance.
Looking ahead, Fidelity highlighted quantum preparedness as a growing focus. Roughly 6.6M BTC could theoretically be at risk due to exposed public keys, but developers are proactively exploring solutions like BIP-360, with the mantra “prepared, not scared.”
On the macro front, Fidelity outlined a bullish setup driven by:
Institutionally, Bitcoin and Ethereum are increasingly treated as core portfolio allocations, with spot Bitcoin ETPs holding $123B in AUM as of late 2025.
Fidelity’s outlook for 2026 boils down to a battle between liquidity and macro risk.
The bull case is straightforward.
Global liquidity is starting to turn. Quantitative tightening appears to be ending, policy is slowly loosening, and governments are clearly choosing growth over austerity as debt levels balloon. With U.S. debt above $38 trillion and debt-to-GDP near 125%, history suggests easier money is the path of least resistance.
That matters for Bitcoin because it has shown a tight relationship with global liquidity, particularly M2 money supply growth.
Fidelity frames Bitcoin as a “liquidity sponge”—when excess capital enters the system, scarce assets tend to absorb it.
Add in $7.5T sitting in money market funds that could rotate into risk assets, plus continued institutional adoption through spot ETFs now holding over $123B in AUM, and the setup for expansion is real.
On-chain activity, stablecoin usage, and developer engagement all support that case.
The bear case, however, is equally important.
Inflation remains sticky, the dollar is strong, and policy, while easing, is still restrictive.
Geopolitical tensions, fiscal stress, and lingering market fragility from the October 2025 liquidation event continue to weigh on sentiment.
If markets tip risk-off, Bitcoin’s deep liquidity cuts both ways: it can absorb shocks, but it can also sell off hard alongside tech and other high-beta assets.
Overall, Fidelity’s takeaway is that Bitcoin is maturing into a macro asset, increasingly shaped by liquidity cycles, institutional flows, and global policy decisions.
And the long-term foundation looks stronger than ever, but the next leg higher won’t come without volatility along the way.
A few headlines that stood out:
Decrypt-a-cookie
This website or its third-party tools use cookies. Cookie policy By clicking the accept button, you agree to the use of cookies.