BitMEX Alpha: Bitcoin Bottom & Q1 2026 Outlook
TL;DR
The Widening Divergence: Gold (+70% YTD) and Silver (+140–150% YTD) have fully expressed the „money printing / geopolitical risk“ trade of 2025. Bitcoin has not. At ~$87,000, BTC is down ~8% YTD, creating a massive relative-value spread.
The Liquidity Outlook: Markets are fading the Fed’s new $40B/month RMP facility because of „credit impulse dilution“ relative to 2009. This is a mathematical trap.
The Catalyst: As the market wakes up to the fact that RMP is functionally QE, we expect Bitcoin to chop between $80k–$100k through year-end before reclaiming $124k and punching toward $200k in Q1 2026.
The Floor:The „sell the news“ first year of Trump inauguration is over, but the administration has three more years to go. Trump’s family and business associates are deeply embedded in crypto, signaling a pipeline of policy catalysts for the next three years.
Relative Valuation: The Gold-Bitcoin Divergence
If you held the „hard money“ view in 2025, you were right on the macro but wrong on the vehicle—unless you bought yellow metal.
Gold and silver have already fully expressed the „money printing / geopolitical risk / rate-cuts“ trade in 2025. Gold is up 70%+ YTD, and silver is up ~140–150%+ YTD, hitting record territory around $70/oz.
Bitcoin hasn’t.
BTC Jan 1, 2025: ~$94,419
BTC Today: ~$87,084 (~-8% YTD)
This creates a clean relative-value pitch: if you believe BTC is in the same „hard asset“ family as Gold, then selling BTC around $87k is effectively selling after a year of massive underperformance versus the very hedge narrative that’s been working elsewhere.
The valuation spread is now extreme. Gold’s market cap has swelled to ~$31.5T while Bitcoin sits at ~$1.7T. The ratio has blown out from ~9x a year ago to ~18x today. Unless Bitcoin has structurally failed as a store of value, this gap must close.
The Political Support: Three More Years
While the market treats the Trump inauguration as a „sell the news“ event for Bitcoin, the political reality suggests the real catalysts are yet to come.
President Trump is only in the first year of his term. Historically, the first year often involves market digestion, but the policy pipeline is still opening up. The White House’s Strategic Bitcoin Reserve (SBR) framework (March 2025) was merely the opening salvo. We expect to hear significantly more about the implementation and expansion of this reserve in the coming months.
Also keep in mind that the Trump administration’s commitment to crypto goes beyond making policy. Trump’s inner circle, family, and business associates have demonstrated deep, skin-in-the-game conviction in the asset class.For example, Trump Media (DJT), has explicitly pursued a Bitcoin treasury strategy, executing a multi-billion dollar funding plan. Latest reporting confirms holdings of around 11,542 BTC.
FUD Assessment: $MSTR Forced Selling is Not a Near-Term Concern
Much of the recent price weakness has been attributed to fears regarding MSCI’s potential exclusion of „Digital Asset Treasury“ firms from major indices in early 2026. Our analysis indicates this fear is misplaced.
The mechanism of index exclusion impacts the equity flows of companies like MicroStrategy, not the spot price of Bitcoin. Furthermore, major corporate holders have fortified their balance sheets; MicroStrategy, for example, has accumulated a $1.44 billion cash reserve to manage debt obligations. This creates a buffer that negates the need for forced liquidation of Bitcoin holdings.
The Liquidity Regime: RMP & The Path to $200k
Another missing link in the Bitcoin bull case is the Federal Reserve. The NY Fed has kicked off Reserve Management Purchases (RMP)—buying $40 billion per month in T-bills.
$40 billion per month is great, but as a percentage of dollars outstanding, it’s much less in 2025 than in 2009. Therefore, we cannot expect its credit impulse at current financial asset prices to be as impactful immediately.
For this reason, the current misguided belief that RMP < QE in terms of credit creation, and the uncertainty of RMP’s existence post-April 2026, will cause Bitcoin to chop between $80,000 and $100,000 until the new year begins.
The Q1 2026 Pivot As the market begins to equate RMP to QE (because it is printing money to buy debt), the repricing will be violent.
Bitcoin will quickly retake $124,000.
Price will punch quickly towards $200,000.
March 2026 will mark peak expectations for the power of the RMP to ramp asset prices.
Following this peak, we expect Bitcoin to decline and form a local bottom well above $124,000 as NY Fed President John Williams keeps his fingers firmly planted on the „Brrrr“ button.
Conclusion: The Trade
We believe the $87,000 region represents a durable bottom, characterised by the transfer of inventory from impatient capital to strategic long-term holders. The risk/reward profile heavily favors a rotation back into digital assets as the market re-prices Bitcoin to reflect the liquidity and inflation realities already acknowledged by the precious metals market.
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