Why This Analyst Is Bullish on Altcoins Again in 2026
Crypto analyst Dennis Liu, known as VirtualBacon, is the most bullish on altcoins he has been in four years, citing a growing Federal Reserve balance sheet as a key factor.
In a video shared on X, Liu credited the expanding Federal Reserve balance sheet since November 2025 as a key reason why this altcoin cycle could outperform the previous one from October 2023 to October 2025. He currently holds the most optimistic view on altcoins compared to the past four years.
Liu outlined three main factors supporting his bullish stance. First, he believes the current Bitcoin cycle remains early, which historically presents favorable conditions for altcoin trading. Second, the altcoin-to-Bitcoin ratio stands at 0.48, near a floor of approximately 0.40, making altcoins relatively inexpensive compared to Bitcoin despite its recent rebound.
Macroeconomic Conditions
The third factor Liu emphasized was timing, noting that after a small breakout following Bitcoin's bottom, altcoins retraced, providing traders with an entry opportunity after the initial move rather than chasing higher prices. His primary argument centers on macroeconomic conditions.
That condition alone, I believe, will be the deciding factor to give us a stronger altcoin cycle in this cycle
Market Performance
Despite Liu's optimism, market prices have recently moved against his predictions. Bitcoin was rejected just under $85,000, causing the total crypto market cap to lose more than $60 billion from its peak. Bitcoin now trades around $82,000 with over 58% dominance, while Ethereum is near $2,400, down 2% weekly.
Matthew Hyland, another market analyst, supported Liu's view by noting that the median altcoin is ahead of Bitcoin year-to-date in 2026 for the first time since 2021. Hyland forecast potential gains of 1,000% to 100,000%, claiming his data places the current market at levels similar to early 2016 and mid-2020.
Despite these indicators, Monero stands out with a seven-day gain of approximately 8%, trading near $613, while most other altcoins have struggled to maintain momentum against Bitcoin's recent price action.
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