Bitcoin price still isn’t in a ‘final cathartic bottom,’ says Bitwise
Bitcoin investors should hold tight, according to Matt Hougan, chief investment officer at Bitwise, because there’s still more pain to come.
“The February 5 event was shocking, but I’m not sure it was the final cathartic bottom,” Hougan said on the Blockspace podcast on February 19. “We’re going to get out of it this year, but we’re still in the depths of it.”
Hougan is referring to Bitcoin’s staggering decline from $72,000 to $60,000 at the beginning of February. Since then, the top crypto has stabilised but still trades in the mid $60,000 range, down from its October 2025 all-time high by nearly 50%.
The near-term future for Bitcoin’s price remains ominous.
“There’s often one or two big shakeouts,” Hougan added. “I wouldn’t be shocked to see another event like that at some point in the future.”
Of late, Bitcoin has behaved as a decidedly risk-on asset rather than the “digital gold” many had hoped for. In response to recent geopolitical and macroeconomic turmoil, Bitcoin slumped nearly 50% while gold rallied to new all-time highs above $5,000. Silver also surged.
Indeed, the divergence caught most Bitcoin bulls off guard, quelling the narrative that Bitcoin would benefit from the same debasement trade that drove precious metals higher.
Winter came early
Although many market watchers have been quick to call the record-breaking October 10 liquidation event the start of the crypto bear market, Hougan thinks the winter started much earlier.
“October is the obvious one,” Hougan said. “But outside of Bitcoin and Ethereum, everything else in crypto got crushed starting with the Trump inauguration in January [2025].”
Big layer 1 blockchains like Solana, Aptos, and Avalanche fell more than 70% in 2025, with the selling beginning in January and continuing straight down, argued Hougan.
To Hougan, institutions were slow to catch on, finally selling into the $19 billion liquidation event in October. That eventually confirmed the crypto winter and sent the top two cryptos, which had rallied during the year, down with everything else.
The four-year cycle
Despite the pain, Bitcoin’s price behaviour shouldn’t come as a surprise. Even if many crypto pundits had said this time was different.
Historically, the top crypto goes through drastic peaks and troughs in four-year boom-bust cycles. What happens is that Bitcoin’s monetary policy halves the issuance of new coins every four years — an event dubbed the halving — which sends investors into a euphoric state that drives a near-vertical rally.
But just as quickly as it comes on, it fizzles out, and Bitcoin gives way to a harrowing bear market, sometimes dropping by 80% to 90% as investors take profits.
To Hougan, large players could mean that such crashes are behind us.
Institutional adoption may mean that Bitcoin’s typical 80% drawdowns only fall to around 50% to 60%, he said. That’s because institutions and retail investors now operate on different cycles. When one group is selling, the other may be buying.
“This is the new reality we’re in,” Hougan said.
Pedro Solimano is a markets correspondent based in Buenos Aires. Got a tip? Email him at[email protected].
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