In the ever-evolving world of cryptocurrency, change is the only constant. Recently, Matt Hougan, the Chief Investment Officer of Bitwise, stirred the pot by declaring that the traditional four-year crypto cycle, which has long shaped the market’s landscape, may no longer hold. In an enlightening discussion with prominent Bitcoin advocate Kyle Chassé and Bloomberg’s ETF analyst James Seyffart, he proposed that crypto might be heading into a new era—one marked by longer phases of growth rather than sharp cycles of boom and bust.
Historically, the rhythms of the crypto market have been heavily influenced by pivotal events like Bitcoin’s halving, fluctuating interest rates, and various significant market corrections. However, Hougan argues that these drivers are losing their power and that we might be witnessing the dawn of a more stable and enduring growth phase.
So, why does Hougan believe the four-year cycle is fading away? He points to a significant trend: the impact of Bitcoin halvings has diminished considerably over the years. In a revealing post on X (formerly Twitter), he explained, “The halving is half as important every four years.” This implies that as block rewards shrink, their influence on the total supply of Bitcoin becomes less significant compared to the burgeoning scale of the crypto market itself.
Why is the four-year cycle dead?
- The forces that have created prior four-year cycles are weaker:
- The halving is half as important every four years;
- The interest rate cycle is positive for crypto, not negative (as it was in 2018 and 2022);
- Blow-up risk is… https://t.co/F9ybjHEeB5
— Matt Hougan (@Matt_Hougan) July 25, 2025
What’s fascinating is how the prevailing economic environment has changed. For instance, interest rate cycles, which were once viewed as drags on crypto performance during downturns in 2018 and 2022, are now acting as catalysts for growth. According to Hougan, we’re in a vastly more stable macroeconomic setting that fosters crypto expansion.
Additionally, the specters of catastrophic market events are diminishing. With the rise of enhanced regulatory frameworks and the influx of institutional players into the space, the infamous volatility of crypto markets might just become a relic of the past. Hougan emphasizes that the “blow-up” risks that previously dictated market cycles have reduced significantly, thanks in part to a strengthened regulatory landscape.
So, what replaces the old paradigm? Hougan foresees a new breed of market forces taking the stage—those that operate on broader timelines, unshackled from the conventional halving cycle. Chief among these are the increasing investments pouring into cryptocurrency-related exchange-traded funds (ETFs), a wave he anticipates will only gain momentum over the next five to ten years.
Institutional adoption also plays a crucial role in this transition. Hougan notes that entities such as pensions, endowments, and national account platforms are just beginning to explore crypto investments. He predicts that this trend will accelerate, especially if more crypto ETFs receive regulatory approval—opening floodgates for institutional capital.
On the regulatory front, a pivotal moment occurred with the passage of the GENIUS Act earlier this year, which Hougan believes heralds a new chapter in crypto legislation. The act has laid down the groundwork for Wall Street to develop serious financial products revolving around digital assets, with projections of billions in investments from banks in the years to come.
🇺🇸 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
Moreover, innovative developments like crypto treasury firms beginning to hold Bitcoin on their balance sheets are reshaping the narrative. Rather than the erratic cycles of yesteryear, Hougan envisions a gradual, sustainable boom in the crypto sector. “I think it’s more of a sustained steady boom than a supercycle,” he remarked, expressing confidence that long-term pro-crypto forces would prevail over the traditional four-year cycle patterns.
Looking to the future, Hougan is optimistic about 2026, foreseeing it as a potentially robust year for cryptocurrency, although he cautioned that some volatility is still likely. His previous insights have also set ambitious price targets, including a belief that Bitcoin could soar to $1 million amid waves of institutional support and policy shifts.
🪙 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
As we navigate this new crypto landscape with potentially reduced volatility and increasing institutional acceptance, one thing seems certain: the trajectory of Bitcoin and the broader market is changing. No longer merely speculative, this new phase prioritizes structural investment—a transformation that could redefine the future of finance itself.
In the dynamic world of cryptocurrencies, do you think we’re ready to embrace this evolution? As institutional money flows in and regulations stabilize, the next few years could be pivotal. Buckle up; the journey is just getting started!