The past few months have been bruising for Bitcoin (BTC) holders. The largest cryptocurrency by market capitalisation touched an all-time high of $126,080 in October of 2025, only to slide sharply afterward. As market sentiment turned, investors pulled away from high-risk bets — Bitcoin (BTC) and the broader crypto market chief among them. Yet the picture could shift again before the year is out.
What Dragged Prices Down
The retreat was driven by mounting geopolitical tension and macroeconomic uncertainty. The US-Iran conflict, which broke out in February 2026, piled extra strain on the economy by triggering energy shortages and spikes in crude oil prices. On top of that, US inflation climbed to 4.2% for the month of May, deepening investor anxiety. Together, these bearish forces have steered the direction of Bitcoin and the wider crypto market over recent months.
Why H2 of 2026 Could Turn Bullish
The second half of 2026 may finally bring some relief, and three developments stand out as potential catalysts.
A Possible End to the War
First, the US-Iran conflict could come to a close. The war has weighed heavily on the global economy, and a peace deal would help ease worldwide energy shortages. An end to the fighting would also lift investor sentiment and revive risk appetite — conditions under which Bitcoin (BTC) stands to gain significantly.
Passage of the CLARITY Act
Second, the long-awaited CLARITY Act could at last be passed. The legislation is designed to bring greater regulatory clarity and stronger investor protection to the crypto market. Should it clear, it could meaningfully boost confidence and channel more money into the space, opening the door to positive price action for Bitcoin (BTC).
A Rebound in ETF Flows
Third, ETF inflows could regain momentum later in the year after the heavy outflows of recent weeks. ETFs have emerged as a key driver of crypto prices — it was strong ETF buying that helped both Bitcoin (BTC) and Ethereum (ETH) reach new peaks in 2025.
