Yes, it can still work in 2026. If you're selling products that comply with Etsy's marketplace policies (for example, eligible handmade items made with a disclosed production partner or qualifying craft supplies) and you're operating transparently, a niche store can still succeed.
However, crypto-only payments are generally not compatible with Etsy's checkout system. Etsy requires sellers to use its supported payment methods in the countries where Etsy Payments is available. Asking buyers to pay you directly in cryptocurrency outside Etsy's checkout would violate Etsy's policies and could result in your shop being suspended.
If crypto is your preferred way to receive funds, Etsy is unlikely to be the right platform for that business model. Crypto payments are more practical on your own website or on marketplaces that explicitly support them