In a captivating conversation packed with insights, Matt Hougan, the Chief Investment Officer of Bitwise, recently stepped into the spotlight, challenging the foundational beliefs around cryptocurrency’s cyclical nature. While many investors have long relied on the historical four-year cycle—primarily dictated by Bitcoin’s halving events—to forecast market trends, Hougan posits that we might be on the brink of a monumental shift. This insight comes from a stimulating dialogue with Bitcoin enthusiast Kyle Chassé and Bloomberg ETF analyst James Seyffart.
Traditionally, the crypto landscape has marched to a rhythm dictated by Bitcoin’s halving cycles, interest rate fluctuations, and various market upheavals. However, Hougan’s recent observations suggest that these longstanding patterns are beginning to lose their grip on the market narrative. He emphasized that the influence of halving events appears to be diminishing, stating that their potency has halved with each occurrence. “The halving is half as important every four years,” he pointed out, calling into question the future utility of this model.
Why is the four-year cycle dead? 1) The forces that have created prior four-year cycles are weaker: i) The halving is half as important every four years; ii) The interest rate cycle is positive for crypto, not negative (as it was in 2018 and 2022); iii) Blow-up risk is… https://t.co/F9ybjHEeB5 — Matt Hougan (@Matt_Hougan) July 25, 2025
So, what does this mean for the future of cryptocurrency? What factors are emerging to reshape the landscape? Hougan explains that as block rewards diminish, their effect on overall market supply is shrinking relative to the expanding market. This shift means that halvings, once seen as pivotal to price surges, no longer hold the same sway. He further noted that interest rates, which previously acted as severe headwinds during down markets in 2018 and 2022, are now providing tailwinds, bolstered by a more stable macroeconomic environment.
Additionally, the ghost of market “blow-ups” that once haunted the crypto market seems to be dissipating, thanks to stricter regulations and increasing institutional involvement. In this new paradigm, fresh capital flowing into crypto-related exchange-traded funds (ETFs) is expected to be a game changer. The wave of institutional adoption, which began in 2024, is still in its infancy, as Hougan anticipates a sustained influx lasting five to ten years. He sees significant potential as more pension funds, endowments, and corporate platforms engage with the crypto space.
On the regulatory front, Hougan is optimistic, suggesting that a new era of policymaking has dawned with the passing of the GENIUS Act earlier this month. This legislative move is seen as a turning point, paving the way for Wall Street to create innovative financial products centered around digital assets.
🇺🇸 As GENIUS Act passes, regulatory paths stabilize across jurisdictions and digital assets may find stronger footing for long-term planning. #genius #stablecoin https://t.co/Hdq2wceITt — Cryptonews.com (@cryptonews) July 18, 2025
Hougan’s insights don’t stop there. He brought attention to the rise of crypto treasury firms that are now holding Bitcoin on their balance sheets. This trend could lead to a more stable growth phase in the crypto market, one that deviates from the erratic booms and busts seen in earlier years. “I think it’s more of a sustained steady boom than a supercycle,” he articulated. “The long-term pro-crypto forces will overwhelm the classic four-year cycle forces.” With this refreshing perspective, he sees 2026 as a particularly promising year for crypto, though he cautions that volatility might still be a lingering companion on this journey.
Looking ahead, Hougan envisions a future where Bitcoin could soar to unprecedented heights—a staggering $1 million, propelled by changes in policy and an influx of institutional support. His earlier predictions stand as markers of this optimism, with Bitcoin expected to reach $200,000 by the close of 2025, boosted by sovereign wealth funds and public companies. The game-changer? Governments venturing into the Bitcoin arena as holders, which Hougan believes have solidified Bitcoin’s place in the financial world.
🪙 Despite the controversy surrounding Trump’s proposed US crypto reserve allocation, Bitwise CEO @Matt_Hougan believes the “market has this wrong.” #Altcoin #DonaldTrump #Crypto https://t.co/rW2zJpsVaC — Cryptonews.com (@cryptonews) March 5, 2025
In conclusion, the cryptocurrency market appears to be at the cusp of a transformative era, one characterized by institutional stability and a departure from traditional cyclicality. As stakeholders in the crypto world, whether seasoned investors or curious newcomers, staying informed and adaptable to these shifts will be crucial. The rabbit hole of crypto may be deeper than we once thought, and as the landscape evolves, so too will the opportunities it presents. So, what’s your next move in this ever-evolving crypto space?
For more insights on cryptocurrency trends and market analysis, be sure to check out CoinDesk and The Block.