Galaxy Digital Says 2026 for Bitcoin Is Unusually Hard to Read — Options, Low Vol and Macro Risks to Blame

Why Thorn’s warning matters for markets right now

Galaxy Digital (GLXY)’s head of research, Alex Thorn, used a recent public update to tell investors something simple and important: 2026 looks harder to forecast for Bitcoin than usual. That matters because Thorn speaks for a big, market-facing crypto firm that helps run trading desks, manages liquidity and advises large clients. When a player like that says the options market is sending mixed signals, traders listen — and they adjust positioning, hedges and where they park capital.

The immediate impact is about uncertainty itself. Thorn isn’t predicting a crash or a boom. He’s saying the usual tools traders use to price and protect their bets — especially options markets and volatility measures — are behaving in ways that make standard forecasts fragile. For professional traders and active crypto investors, fragile forecasts mean wider bid-ask spreads, more expensive hedges and a higher chance that a single macro surprise will move prices a long way.

Thorn’s core points: options, falling volatility and macro risks

Thorn laid out a few interlocking themes. First, the options market has become a central driver of price action; flows into and out of structured products are changing how directional bets get expressed. Second, measured volatility is down from recent peaks, which reduces the price of protection but also hides risk that’s still there. Third, macro policy — especially central bank rhetoric — looks more uncertain, which could flip the market from calm to chaotic fast.

In Thorn’s words: “Options positioning is compressing implied volatility, and that makes one big macro move much more disruptive.” He added that falling volatility doesn’t equal low risk: “Just because implied vol is lower today doesn’t mean the stomach for shocks has returned.” Those two lines capture the tension: cheaper protection and thinner risk buffers on one side, the same big-picture risks on the other.

Market signals right now: price, vol, options flows and macro cross-currents

For traders, the picture is familiar but with a twist. Bitcoin’s price action has been relatively range-bound recently; that quiet has pushed implied volatility down from the levels seen during the last big rallies and selloffs. When implied volatility falls, option premiums decline, which makes it cheaper to buy protection — but it also pressures liquidity providers to reduce inventory, tightening the market.

Options open interest has shifted toward more complex structures: blocks of calendar spreads, variance trades and structured notes instead of simple outright calls or puts. That change means price moves can be amplified by gamma squeezes or by market makers rapidly adjusting hedges when volatility moves. Skew — the extra cost of downside protection versus upside exposure — has narrowed in some expiries, suggesting demand for crash insurance eased, but larger-dated expiries still show a premium for downside protection.

Funding rates on perpetual swaps have been subdued compared with episodes of intense leverage. That points to less one-sided speculative positioning, but it also makes it easier for a shock to attract new leveraged flows quickly. On the macro front, recent comments from regional Fed voices — like Cleveland Fed officials signaling fewer rate cuts — add a layer of risk. If macro narratives shift from “rates are falling” to “rates stay higher for longer,” risk assets including Bitcoin could see fast repricing.

Practical implications for traders and investors

Thorn’s assessment has clear, practical consequences. First, hedging matters more. In a low-volatility environment, protection is cheaper but not less necessary. Traders should think in scenarios: small, cheap options can protect against short-lived shocks; longer-dated hedges guard against regime change. Second, position sizing should be conservative. With thinner liquidity and compressed vol, even modest flows can move markets, so large directional bets carry outsized execution risk.

Volatility trades look appealing in two ways. Buyers of volatility get protection if a macro shock hits — expect demand for puts and straddles to spike around major macro events. Sellers of volatility can earn premium in a calm market but risk large losses if a surprise revives volatility. Structured players may prefer spread structures (e.g., calendar or vertical spreads) that limit downside while capturing a view that vol will stay muted.

Finally, note that options structure affects payoff profiles. Because skew and term structure are not uniform, a generic “buy puts” trade may be expensive in some expiries and cheap in others. Traders who focus on where option demand is concentrated — near-term expiries around macro events, or long-dated tail hedges — will find clearer risk-reward profiles.

Why Galaxy Digital still leans bullish long-term

Despite the near-term fog, Galaxy Digital (GLXY) keeps a long-term bullish stance. That makes sense: firms like Galaxy hold multiple business lines — trading, asset management, investment banking — and a long-term constructive view supports product offerings like structured yield and strategic investments. Thorn’s warning is not a pivot to bearishness; it’s a call for prudence in positioning while remaining positive on the structural case for crypto adoption and institutional demand over years.

The firm’s public posture matters because Galaxy moves markets by providing liquidity and by distributing products to large clients. When it flags that options dynamics are changing, institutional desks and hedge funds often tighten risk limits or reprice products, which can feed back into market volatility itself.

Three 2026 scenarios: triggers, market reactions and watch-points

Scenario A — Volatility pick-up after a macro shock: Triggered by a surprise hawkish Fed comment or a geopolitical event, implied volatility jumps, dealers scramble to hedge, and Bitcoin gaps sharply in one direction. Confirmation: rapid rise in near-term implied vol, flight to downside puts, and widening spreads. Implication: heavy losses for naked sellers of vol, strong demand for long-dated protection.

Scenario B — Orderly rally on structural flows: Institutional adoption news or large ETF inflows push price higher without a vol spike. Confirmation: steady inflows into spot and investment products, skew remains neutral-to-positive for calls, funding rates tick upward gradually. Implication: call buyers and carry traders profit; dealers earn premium from increased trading volumes.

Scenario C — Protracted sideways market with low vol: Macro conditions remain stable, implied vol stays compressed, and price grinds sideways. Confirmation: low funding rates, muted options flow, and concentrated calendar spread activity. Implication: income strategies (selling premium via spreads) perform well but risk sudden losses if a shock arrives unhedged.

Where to focus next quarter

Thorn’s main message is: watch the plumbing. For traders and active investors, keep an eye on implied vs. realized volatility, options open interest by expiry, skew across strikes, and funding rates on leverage instruments. On the macro side, monitor central bank communications and scheduled policy events — those are the likely triggers to flip a low-volatility environment into a high-volatility one.

In short, 2026 looks less like a predictable uptrend or downtrend and more like a market where a handful of outsized events will decide the next big move. That means disciplined hedging, cautious sizing and paying attention to the options market’s subtle signals are more valuable than ever.