GM. This is Milk Road PRO, where we try to predict the future before AI does it for us.
These reports are normally kept hidden just for PRO members, but this one was too important to keep behind the paywall. I want our entire community to read it.
So for our free subscribers, enjoy the manifesto that will define everything Milk Road does in 2026 and beyond.
2025 was a tough year for crypto investors:
- Bitcoin ended the year down 6%.
- Ethereum, down 11%.
- And the broader altcoin market was down around 36%. š¤Æ
At the same time, outside of crypto, it was an incredible year for investors.
The Nasdaq was up 20% and Gold was up a stunning 66%.
That was a tough one to predict considering 2025 was meant to be a big one for crypto according to the 4-year cycle or the Bitcoin Halving thesis.
Whether we head higher or lower from here, it's clear that the 4-year cycle thesis is broken. Crypto markets have changed and thus as investors, we must change too.
So, what went wrong last year?
Interestingly, in terms of the fundamentals for the crypto space, plenty went right for the industry in 2025, with things like:
- The passing of the GENIUS Act.
- A strategic Bitcoin reserve was established in the U.S..
- The restructuring of the SEC, which frees crypto builders and companies to innovate.
- Stablecoins increased by more than 50%, from $206B to $310B.
- And we had an explosion of crypto assets move to public markets via IPOs, DATs and ETFs.
Even so, prices didnāt seem to move along with those fundamentals.
Maybe much of the above was already priced in after the big move in crypto back in November/December of 2024?
Maybe other markets like AI and Gold/Silver stole the show in 2025 and sucked up a lot of the capital that would have otherwise come into crypto?
Maybe it takes longer than expected for the above fundamental changes to make an impact on price, since the next marginal buyer is the slow moving institutions rather than the fast-paced retail investors?
Or maybe crypto has a lot more to accomplish before it can justify valuations higher than they are today?
I would say the lackluster year we had in crypto prices in 2025 was a result of a combination of all the above.
The good news is that means there is still plenty of growth left in this space ahead. It also means that as investors, it might be wise for us to broaden our horizons and look outside of our crypto bubble for investments too.
For many of us in crypto, it was the potential of crypto that made us become investors in the first place. Itās the dream of a 100x altcoin or a brand new financial system that has kept us here.
But I think itās important for everyone reading this to understand that something bigger is happening in the world right now. Crypto is a big part of it, but itās not all of it.
What Iām referring to is: The Exponential Age.
Multiple breakthrough technologies (blockchain, AI, robotics, etc.), all hitting their inflection points at the exact same time, each one feeding off and accelerating the others.
It's an incredible time to be alive. And for those paying attention, it's an absolutely generational time to be an investor.
But, there's a narrow window to capitalize on this, because once these technologies hit escape velocity and reach their full potential, it's unclear to me how traditional markets will function or how most people will generate income in a world reshaped by automation and abundance.
The next 3ā5 years are make-or-break for putting capital to work aggressively and compounding to build a real, lasting capital base. The kind that gives you options no matter what happens next.
So what's actually coming next?
I think the best way to describe it is: A global technological upgrade.
Here's what I mean:
- The global financial system is being uplifted and moved onchain.
- The labor market is being revamped from humans to AI-powered robotics.
- The entire transportation complex (cars, buses, trucks, delivery) is converting to autonomous vehicles.
- Our daily devices like iPhones and laptops are upgrading from web/app tools to true AI companions.
- Energy production, data centers, internet, manufacturing, and mining are all shifting to outer space.
- Genomics and biotech are overhauling healthcare with personalized medicine, gene editing, and longevity therapies that could add decades to healthy human lifespans.
There are plenty more upgrades in the works too, but the magnitude of just these six is impossible to overstate. Even just one of them on their own would be world-changing, yet we have 6+ that are all interconnected, self-reinforcing, and finally crossing the chasm from hype to real-world scale.
If your portfolio consists of crypto only, then youāre exposed to the first technological upgrade and missing the rest. This is where I want the members of Milk Road PRO to wake up and understand the opportunity we have.
Crypto is not the only world-changing technology in front of us. We have an opportunity to diversify across multiple technological trends. Each of which will take the spotlight in terms of adoption and price performance at different times (and sometimes at the same time too).
Now, I get it, we've heard this kind of big-tech-revolution talk for years. Crypto was supposed to take over finance back in 2017 and self-driving cars were "almost here" 10 years ago too.
So it's easy to look around today and think: Here we go again, just another 4-year crypto hype cycle and AI is the new dot-com bubble ready to burst.
A lot of people are already calling the top, saying 2026 is the bear market year for crypto and the AI bubble will pop.
But I couldnāt disagree with these people more. They continue to look at data and use frameworks that no longer make sense in the new world we are entering (like the 4-year crypto cycle).
The time to pay attention, to get ahead of these changes and to invest in these trends is right now. My vision for 2026 is simple: Crypto will have an amazing year, AND other sectors will too. And as a smart investor, I am diversifying my exposure to other tech with equally massive upside. This is based on what's happening in the world and what our PRO research team tells me behind closed doors everyday.
Todayās report is going to explain my thesis on how the world is changing, what matters for our investments today, how to set up our portfolio across these trends and whatās changing at Milk Road to ensure you capitalize on this long-term.
But I will tell you right now, before we start: weāre going heavy on AI. Weāre adding an AI portfolio to our PRO All Access tier, and weāve bolstered the lineup with new experts in this field to deliver the best investing content in the industry. More on that below.
2025: THE FOUNDATION FOR THE EXPONENTIAL AGE WAS LAID
I want to start this off by helping you all understand what changed in 2025 for me to claim that all of the technologies above have reached their inflection points and that The Exponential Age is truly here.
In the intro, I listed 5 big things that happened to the crypto industry. In addition, the market structure bill (Clarity Act) was approved by the House in Q3 of 2025, and is set to be passed by the Senate in Q1 of 2026.
These are foundational changes that enable orders of magnitude more capital to enter and allocate to the crypto industry. Weāve already built an entirely new, global, financial system onchain which moves at the speed of the internet and the costs to use it are almost nothing. This is a massive upgrade to the broken, slow and costly financial system used today.
The main thing holding back this new, onchain financial system is that it doesnāt currently integrate with the world's best financial assets:
- Itās missing the world's best equities like NVIDIA, Google or Tesla.
- Itās missing the worldās best indices like SPY or QQQ.
- Itās missing the world's best commodities and metals like Gold, Silver and Copper.
- Itās missing the world's most used yield assets like treasuries and government or corporate bonds.
- Itās missing the world's most used financial assets like the dollar or the euro.
For ecosystems like Ethereum and Solana to flourish and become the world's best financial systems, they need to have the world's best financial assets.
2025 was the start to this trend but I believe this will accelerate from here on out with the market structure bill giving the playbook for institutions to start tokenizing the world's best assets onchain.
We saw 50% growth in dollars moving onchain last year from the GENIUS Act and I think weāll see similar, if not more, growth for the rest of the world's assets moving onchain in 2026.
To track this, weāve created a āTradFi assets moving onchainā chart in the brand new Milk Road Data HQ. In my opinion, this is the most important chart in crypto. Weāre currently at $318B and I think weāll be above $750B by the end of 2026.
In terms of the other 5 global technological upgrades, they mostly have to do with technologies like AI and robotics which are being built by American corporations. Like crypto, regulation plays a critical role in the adoption and innovation of these trends too.
From an investment standpoint, the regulation was already clear. So these trends were not held back like crypto has been the last few years. Again, likely a big reason crypto didnāt participate much in the 2025 bull market.
That said, there is still plenty of regulation that needs to get figured out around AI and robotics, like allowing unsupervised fully self-driving vehicles on public roads. These are the kind of unknowns weāll have around the world which may accelerate or decelerate these global technological upgrades.
What became clear in 2025, however, is that Trump and his administration are all-in on deregulation to let these industries scale. For example, one of the biggest AI bottlenecks ā data center buildout and energy access ā saw multiple executive orders slashing permitting timelines, compliance burdens, and studies to speed things up.
From day one of Trump's second term, the focus has been on accelerating The Exponential Age in the U.S., not holding it back like the previous administration. We've got three years left of this administration clearing the path for American companies to dominate AI, robotics, and the rest.
The big question for 2026: Can they get the key regulations passed to unlock real progress?
Finally, the macro environment remains in a Goldilocks scenario heading into 2026. A perfect storm for innovation to continue to flourish while markets continue to move higher. For a full deep dive on macro heading into 2026 Iād recommend reading Tomasās Milk Road Macro PRO report here - this is probably the best macro outline youāll ever read.
But for a quick summary:
Inflation and inflation expectations have plummeted in Q4, with Truflation now showing the inflation rate below 2%.
At the same time, U.S. GDP growth is accelerating, reaching its highest number since 2023.
The final piece of the puzzle is jobs data, which doesnāt look great from the headline numbers, but the leading indicators tell a completely different story (see the macro PRO report for more). The data above gives the Fed plenty of room to continue lowering rates in 2026, which becomes even more likely once Trump replaces the Fed Chair with one of his own in the next few months.
From what I can see, 2025 was the year companies began to significantly ramp up their use of AI and automation, which is resulting in considerable efficiencies and driving up earnings. It was earnings that drove the bull market in equities in 2025, not speculation.
If these trends continue, we will have an incredibly strong economy throughout 2026. That is the base case from the Milk Road PRO analysts.
2026: A GLOBAL TECH UPGRADE
After an incredibly strong year fundamentally for technology and a macro environment which looks supportive for growth ahead, 2026 appears to be setting up for a breakout year.
I believe by the end of 2026, the world is going to look and function very differently than it does today. Before getting into how we can invest in it, let me paint a quick picture for you to help you wrap your head around some of the big trends that will shape the world in 2026.
Hardware upgrades
By the end of 2026, I believe many companies will be forced to upgrade their workers' phones and laptops to keep up with the AI tools (LLMs and agents) that will be available in the workplace. Consumers will want the upgrades too, as we unlock new agentic use cases like Siri becoming much more capable (think: Siri more like ChatGPT but having the ability to execute tasks via voice commands, like āorder me an Uberā or āorder me the groceries for my favorite cheesecake recipeā).
Anyone with older hardware simply won't have the on-device processing power to run these new AI features properly. I experienced this last week when I was forced to buy a new iPhone as my old one kept freezing during long and complex discussions with Grok. I'm likely needing a new laptop soon too, despite buying a MacBook Pro in 2023 as it struggles with video calls, AI note-taking, and research using LLMs simultaneously, and that's only going to worsen as AI agents become the standard next year too.
2026 marks the start of a massive, global AI-driven device upgrade cycle. Over the coming years hardware sales will boom, chips will move in huge volumes and the effects will ripple through supply chains and commodities.
Transportation complex overhaul
Take this same scenario and now apply it to cars and transportation in general. By the end of 2026, itās very likely that Tesla will have completely solved fully self-driving vehicles. In fact, I believe itās already solved today, it's just going to take some time from a technical and regulatory perspective to roll it out.
When people have the choice to buy a car that drives itself, letting them sleep, work, use their phone, or watch a movie with others in the car, versus a car they still have to drive themselves, which one do you think they'll pick?
Or take it a step further, what if that car can also generate income for you by working as a robotaxi while you're at the office or asleep? Again, which car do you think people will choose?
Below is a chart of global cellphone shipments year over year. Can you guess which year our cellphones became āsmartā? It was 2007, when the iPhone launched. Shipments roughly doubled over the next three years and peaked about five years after that.
Source: Grok
I believe we'll see a similar pattern when cars turn "smart". 2026 is the year this starts becoming reality, at least in the U.S.. That said, the big numbers likely wonāt hit until 2027, but markets always price things forward. That's why the time to allocate to this trend is now.
Here come the robots
Another big technological upgrade on the hardware side of things which I believe will reach an inflection point in 2026 is corporate robotics within factories and stores. To be clear, I donāt mean generalized humanoid robots, I think this is still a few years away. But instead, I mean stationary and more specific robot arms which handle repetitive tasks. You can see an example of these robot arms making an espresso here.
Robotics like these already exist in many factories, but in the past they have been very costly and required specialization to build and install. Today, the tech is much cheaper and easier to deploy, making robotics available to many more businesses and use cases. I believe this will be another big driver of earnings for companies of all sizes.
The commonality between these 3 big technological upgrades I mentioned above is that itās all based on hardware. The innovations of the last 20 years have all been around software, with applications like Instagram, Netflix, Airbnb, Uber and even ChatGPT. While these innovations attract hundreds of millions to billions of users, they donāt have massive impacts on the physical economy.
Now that we are applying software (AI) into the physical world (cars, drones, robots, devices, etc.), itās going to have massive downstream effects on the physical world, everything from the materials needed to build the robots to the energy and infrastructure needed to power the AI.
In addition, these technological upgrades, and likely many others that I donāt see or understand yet, are going to provide incredible efficiencies within companies. This will continue to put downward pressure on inflation, create net new products and companies (and hopefully jobs) and drive earnings much higher from here.
These are some of the biggest changes happening in the world today (much bigger than crypto) and they will likely break a lot of the old data points that macro experts have relied on for years to understand the economy. That's why, as investors, it's so important not just to stay deep in crypto, but to also understand AI and robotics, and how these trends reshape the broader macro landscape.
WHAT THIS MEANS FOR CRYPTO
I want to reiterate what I mentioned above. There is one more big technological upgrade that is coming in 2026 and thatās the migration of the traditional financial system to the onchain financial system.
The CEO of SharpLink, Joseph Chalom - the guy who launched the first ever BTC and ETH ETFs at BlackRock as well as the BUIDL fund on Ethereum - had a great take on this for 2026. He predicts that stablecoins will surpass $500B (currently $310B) and RWAs will hit $300B (currently $20B) in 2026.
We are already seeing the acceleration of this happening and the market structure bill isnāt even passed, nor is the GENIUS Act actually in law yet. That said, the key is that banks and companies just need to know what the rules will look like, so they can move ahead of formal approval.
That's why in 2025 most of the largest financial institutions began launching or using stablecoins ā from fintechs like PayPal, Revolut, and Robinhood, to payment giants like Stripe, Visa, and Mastercard, all the way to big banks like JP Morgan and Bank of America.
Even without full market structure clarity, we're starting to see tokenized funds from BlackRock and Franklin Templeton, tokenized equities from Kraken and Robinhood, and the biggest development of all: the SEC authorizing the Depository Trust & Clearing Corporation (DTCC) to launch tokenization services for the +$100T in securities it custodies. š¤Æ
Once we get the final details of the market structure bill early this year, I believe there will be a race to move the world's best assets onchain. This will be cryptoās big moment, not the retail-driven NFT bubble of 2021 or the memecoin mania of 2024-25, but the acceleration of TradFi migrating onchain.
Like I said, 2026 is shaping up to be a breakout year for AI, robotics and the onchain financial system, and I didnāt even mention the developments happening in space or healthcare yet (Iāve gone on too long so Iāll leave those out for now).
But, the real question is: How do we position our portfolios to capture this upside?
HOW DO YOU POSITION YOUR PORTFOLIO FOR THE EXPONENTIAL AGE?
Let me say this again! As exciting and big as the AI and robotics trend is for 2026, I still believe crypto will have the biggest upside in 2026.
Why do I say that?
A big part is because of current sentiment and positioning. Most of the stock market sits at all time highs while most crypto assets are down 30%+.
The other reason is that there still remains a massive gap in terms of the amount of capital that exists vs. the amount of capital that can actually be allocated to crypto assets. This is a big part of what the market structure bill will unlock, in addition to accelerating the trend of bringing digital assets to public markets via ETFs, DATs and other products.
As a result, in crypto we still have high growth assets sitting at price to earnings ratios (P/Es) of <20, in some cases even <10. This would be unheard of in the stock market, which is typically priced at āperfectionā. This is why I continue to say that at some point, certain crypto assets will get completely repriced. Even Coinbase, the largest public crypto company in the world, reaches oversold levels that you donāt often see in other sectors, like its current P/E of 20.
When you understand and believe in this industry as much as we do, itās difficult to allocate to anything other than these incredible opportunities. That said, years like 2025 make you realize how important it is to diversify regardless of this belief.
Especially when you consider that at Milk Road PRO, we nailed macro the entire year in 2025.
We called that inflation wouldnāt be a problem, that rates would come down, the dollar would come down, tariffs wouldnāt be a problem and that early 2025 and late 2025 were both just growth scares, which wouldnāt turn into recessions.
As a result, we remained bullish on risk assets and added risk to the portfolio during dips.
This was the right playbook, however, we played it with the wrong asset class. Unfortunately, crypto didnāt play ball like the rest of the market did. And while maybe 2025 was just a fluke year because of the various tailwinds crypto faced with regulation, we couldn't help but notice how well our portfolio strategy would have performed if we applied the same logic to the AI and robotics sector. We think the key here is to diversify your portfolio across the various technological trends and invest for the long term. That way, you can maintain the exposure of high upside assets that beat inflation and the typical investing benchmarks of 10%/year, but aren't reliant on any one industry's success.
I know many of our readers are already investing in other industries outside of crypto, however, I want to share my thoughts on how weāre thinking about this.
Firstly, weāve just launched Milk Road AI PRO to help you navigate these other technological trends and find the best investments to build a portfolio with.
We spent a lot of time this week choosing what our picks would be, and the first three will be rolled out in the next couple weeks to PRO All Access members. Plus, our first AI PRO AMA with Vincent (AI PRO researcher) and Melvin (AI newsletter writer) will be on January 20th, and members have the chance to pick Vincentās brain about his first two AI PRO reports (and what heās looking at next).
Now, in terms of the bigger picture, itās important to realize that AI & robotics are still risk assets, just like crypto, so this isnāt a hedge against a risk-off environment. Itās just diversifying within risk. The same macro rules we apply to investing in crypto (ie. liquidity, financial conditions, business cycle), apply to AI & robotics.
However, AI and robotics give us another lever in our portfolio. Hereās how I think about it:
Crypto is still the fastest horse in the race and likely will be for a few more years since the entire industry sits at just a $3T market cap.
My expectations are that the crypto majors like BTC, ETH, SOL and COIN can do multiples in a good year (2-3x), whereas the AI & robotics majors (ie. Mag 7) I expect more of a solid 25-35% in a good year. Although Google had a stellar return of 66% in 2025, I wouldnāt expect this to be the norm from the Mag 7.
On the other hand, certain crypto small caps (aka alts) have the opportunity to still do a 5-10x in a good year (not saying this is easy, just saying itās possible), whereas the AI & robotics small caps would be more like a 2-5x (again, not easy, but possible).
If youāre someone who doesnāt do well with volatility and canāt handle the 30-50% pullbacks that come with crypto (Iām looking at those of you who yell at me in our PRO Discord every time we get a pullback), then holding mostly majors in both categories would be best, and leaning towards a larger share in AI majors rather than crypto. This would also be wise for those investing in a shorter time frame (1-2 years) who want to limit downside (though remember, these are all still risk assets so pullbacks will happen!).
If youāre thinking more long-term, have no issue with volatility and just want the highest upside, then holding a larger share of crypto majors and small caps vs. AI would make more sense for you right now.
Personally, I fall into the second bucket. I have a portfolio that Iām investing for the long-term, that I do not need to touch regardless of what happens in my life, as I have a pile of cash set aside as a ārainy day fundā. This portfolio is 75% crypto and 25% AI and robotics. However, this % is also fluid, as I may rotate assets from one sector to another if one decides to go on a big run, while the other remains stagnant or has a severe pullback.
The best way to picture your portfolio is in 3 buckets:
1. Cash
- Immediate cash
- Yielding cash
2. Crypto
- Majors
- Small caps
3. AI & robotics
- Majors
- Small caps
Based on your risk tolerance and time frame, you may adjust the % you allocate to each sector and within each sector. As weāve discussed for years at Milk Road, the business cycle and liquidity cycle also determine the % we would allocate to and within each sector too.
KEY TAKEAWAY
The main point I want to make in all of this is that each of these technologies we are investing in is part of a secular, long-term trend. These are not 1-2 year fads that you need to rush in and out of. They are world-changing technologies that will develop over the coming decades. The best way to capitalize on these trends is by finding the best assets and holding them for as long as possible and adding to them when they become undervalued.
You can shift your exposure based on cycles, sentiment, performance, etc. as you please, but ultimately, the best thing you can do to reach financial freedom and build a strong capital base is to continue to add to your portfolio over time.
Crypto, AI & robotics have decades of growth ahead of them, and your goal is to capture as much of that upside as possible for as long as possible. This is precisely why we created Milk Road PRO - to help you achieve that goal. To help you win alongside our experts at Milk Road and our amazing PRO community that drives the conversation forward every single day in our PRO Discord. We canāt do this alone. And neither can you.
Iām going to leave you with a set of investing rules that I live by which are critical to helping you succeed with your portfolio:
Your goal as an investor is to increase your probabilities of making money, while not losing money.
It's all about risk/reward.
Here's how I think about it:
- Invest in secular trends, these assets are more likely to go up than those not in one.
- Expand your time horizon, the longer you hold an asset in a secular trend, the more likely it is to go up and the more money you'll make.
- Look for fundamentally strong assets. A good company, w/ a good team, w/ a good product and solid financials is very likely to power through ups and downs of economic conditions, market cycles and innovation disruptions.
- Allocate when markets are red, in fear and the timeline is calling for it to be over.
- Continue adding to your winners during red days and fear if they fit the above.
- If you need to take profits, take them when markets are green and euphoric.
- Don't take profits to buy back in lower (i.e. trade). This only increases your chances of making mistakes and losing money. It also limits your upside from the secular trend.
- Build up a rainy day fund of cash so that you never become a forced seller because of unforeseen expenses (6 months at least - it will make volatility a lot less emotional too!).
- Don't stop learning. building conviction to hold good assets, in secular trends, long-term, is the key to your success.
Remember, your job as an investor is to increase your probabilities of winning and decrease your probabilities of losing - don't forget the second part of your job!
Our next AI PRO report is coming out tomorrow. But itās just a taste of what AI PRO is going to be, and it's just a fraction of what PRO membership really is. We have portfolio picks coming soon, on top of our first AMA on January 20thā¦
If you arenāt an AI PRO member yet weāre offering a 20% off discount for new members.
Join us as we enter this generational opportunity: The Exponential Age.
