Bitwise Chief Investment Officer Matt Hougan has questioned the persistence of Bitcoin’s (BTC) historical four-year cycle, suggesting that recent policy shifts in Washington could extend the current bull market into 2026 and beyond.
In a letter to clients, Hougan highlighted that Bitcoin has traditionally followed a cycle of three strong years followed by a pullback. He had previously identified this pattern in mid-2022, predicting a market rebound that materialized in 2023 and 2024.
Based on past trends, 2025 is expected to be another strong year. However, the outlook for 2026 may differ from previous cycles.
According to Hougan, economic factors rather than Bitcoin’s halving events are the primary drivers of the four-year cycle. Market upswings typically begin with a significant catalyst, attracting new investors and fueling momentum.
Eventually, speculative excess leads to corrections, as seen with past events such as the collapse of Mt. Gox in 2014 and the crackdown on ICOs by the US Securities and Exchange Commission (SEC) in 2018.
Catalysts
The Grayscale legal victory against the SEC in March 2023 catalyzed the current cycle, which Bitwise dubbed the “Mainstream Cycle.” This ruling paved the way for Bitcoin exchange-traded funds (ETFs), which launched in January 2024 and drew significant institutional investment.
Since that initial ruling, Bitcoin’s price has surged from $22,218 to over $102,000. Meanwhile, President Donald Trump’s recent executive orders related to digital assets have introduced a new variable that could catalyze another rally to new heights.
The order designates expanding the digital asset ecosystem as a “national priority,” signals regulatory clarity, and outlines plans for a potential “national crypto stockpile.” These actions, combined with a pro-crypto shift within the SEC, may accelerate Wall Street’s integration into the crypto market.
Hougan predicts ETF flows and corporate Bitcoin purchases could push Bitcoin’s price beyond $200,000 in 2025.
While he acknowledges growing market leverage through debt-financed Bitcoin purchases and lending programs, institutional adoption and regulatory support may prevent the severe corrections in past cycles.
Though speculation-driven pullbacks remain possible, Hougan expects any downturn to be less severe than previous cycles due to the crypto market’s maturation. With institutional participation increasing, he sees long-term upward momentum continuing despite inevitable volatility.
Hougan suggested that traditional market cycles may no longer apply as the crypto market evolves, marking a shift towards broader institutional integration and sustained investor interest.
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