Key Takeaways
- Bloomberg Intelligence analyst James Seyffart warns that intensified competition could trigger widespread crypto ETP liquidations as early as 2026.
- More than 120 crypto-related ETF filings are already in the pipeline, and regulatory changes could fuel further launches.
- Technical indicators point to further downside for the wider crypto market.
A wave of closures and liquidations could hit crypto exchange-traded products (ETPs) as early as 2026, according to a Bloomberg Intelligence analyst, as issuers continue to flood the U.S. market with new crypto-linked funds amid weakening market conditions.
The warning comes as CCN analysts report technical indicators pointing to renewed downside risks for the broader cryptocurrency market.
Looming Crypto ETP Liquidations
James Seyffart, an analyst at Bloomberg Intelligence, said he expects significant liquidations among crypto ETPs over the next two years as competition intensifies and weaker products struggle to remain viable.
“I’m in 100% agreement with Bitwise here,” Seyffart commented on X.
“I also think we’re going to see a lot of liquidations in crypto ETP products. Might happen at the tail end of 2026, but likely by the end of 2027.”
Seyffart warned that issuers are launching products at an unsustainable pace, noting that at least 126 crypto-related ETF filings are already in the pipeline.
“Issuers are throwing a lot of product at the wall,” he added.
In further remarks, Seyffart suggested the number of launches could decline sharply if markets turn decisively lower.
“100 is a safe number assuming we don’t see a 50% drop from here,” he said. “There’s already about 130 in the market today if you include buffer and covered-call type products.”
Rising Closure Risk
Seyffart’s comments were made in response to a forecast from Bitwise Asset Management, which predicted that more than 100 crypto-linked ETFs would launch in the U.S. in 2026.
Bitwise attributed the expected surge to regulatory changes, saying the U.S. Securities and Exchange Commission (SEC) plans to publish generic crypto ETF listing standards in October 2025.
While the move would allow issuers to launch products under a common framework, historical trends suggest that rapid expansion often precedes consolidation.
According to data cited by The Daily Upside, 622 ETFs were closed globally in 2024, with the U.S. accounting for 196 of those shutdowns.
Another 179 ETF closures were recorded in the first four months of 2025 alone.
Deeper Crypto Decline
Adding to the caution, CCN analyst Valdrin Tahiri said technical signals suggest the broader crypto market may be heading for another sharp downturn.
The total cryptocurrency market capitalization has fallen more than 30% from its all-time high of $4.27 trillion, reached on Oct. 6, Tahiri noted.
Tahiri estimates an initial downside target of $2.50 trillion in total market value, implying a further 15% decline.
A deeper selloff could push losses to 30%, dragging the market toward the $2.05 trillion level.
At the same time, macroeconomic risks are mounting, with Japan’s central bank signaling it may begin selling ETF holdings and raise interest rates to their highest level in three decades.
Taken together, analysts warn that weakening market structure and an oversupplied crypto ETF ecosystem could set the stage for heightened turbulence.
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Kurt Robson is a London-based reporter at CCN, specialising in the fast-moving worlds of crypto and emerging technology. He began his career covering local news in Cornwall after graduating from Falmouth University with First Class Honours in Journalism. There, he cut his teeth on everything from council meetings to missing swans.
He quickly rose through the ranks to become a frontline journalist at several of the UK’s leading national newspapers. Over the years, he has interviewed musicians and celebrities, reported from courtrooms and crime scenes, and secured multiple front-page exclusives.
Following the upheaval of the COVID-19 pandemic, Kurt shifted his focus to technology journalism—just ahead of the AI boom. With a natural curiosity and a trained eye for emerging trends, he has found a new rhythm in reporting on innovation.
At CCN, Kurt's work focuses on the cutting edge of crypto, blockchain, AI, and the evolving digital world. Drawing on his background in people-first reporting and his deep interest in disruptive tech, Kurt delivers stories that are insightful, entertaining, and human-centric.
