Bitwise's Director of Investments Matt Hougan stated that the current bear cycle in the digital asset market began back in January 2025. The influx of institutional capital amounting to $75 billion temporarily masked the depth of the decline of most tokens from retail investors.
Experts disagree on the date of the end of the crisis, predicting a recovery from early to autumn 2026.
Market weakness as a sign of a bear cycle
In a recent review, Hougan dismissed the theory that the current price dynamics is a temporary pullback. On the contrary, he described the market situation as a deep bear cycle, pointing to a significant decline in the value of the largest assets. $BTC is currently trading about 39% below its historical maximum recorded in October 2025.
At the same time, Ethereum's indicators decreased by 53%, while many alternative coins demonstrated even more significant declines. Hougan compared the current situation to the 2022 crisis. In his opinion, the negative trend is caused by excessive leverage and mass profit-taking by early market participants.
The impact of institutional demand on asset resilience
Institutional demand played an important role in restraining the pace of the decline. Data from the Bitwise 10 Large Cap Crypto index show a clear division of assets into groups. Tokens supported by large investment funds, such as Bitcoin, Ethereum, and XRP, showed relatively moderate declines.
Assets that gained access to exchange-traded funds (ETFs) in 2025, including Solana, Chainlink, and Litecoin, suffered significantly more. At the same time, instruments without institutional players collapsed by 60-75%. Therefore, the resilience of any asset today directly depends on access to it by large organizations.
Dynamics of the largest cryptocurrencies in 2025
Over the past year, more than 744,000 bitcoins worth about $75 billion have been accumulated through ETFs and digital treasuries. Hougan is confident that without this support, the losses of the first cryptocurrency would have been catastrophic. The retail segment of the market has been in a severe crisis for a year, however, institutions have long hidden this truth.
Market psychology and the accumulation of growth potential
Hougan also explained why positive news, such as legislative progress or the acceptance of cryptocurrencies by Wall Street, does not reflect in the quotes. In periods of deep decline, any fundamental improvements are ignored by market participants. Bear cycles do not end amidst enthusiasm but as a result of complete exhaustion of sellers.
Nevertheless, the accumulated array of positive factors transforms into what is called 'potential energy.' This resource will become a driver of recovery as soon as market sentiment stabilizes. Possible catalysts for growth include the acceleration of the global economy, the adoption of new market transparency laws, and government recognition of Bitcoin.
Discussion on the timing of the market decline's end
Although Hougan considers January 2025 the starting point of the cycle, not all analysts share this view. Head of research at CryptoQuant Julio Moreno noted that Bitcoin maintained an upward trend throughout almost all of 2025. According to him, the official start of the bear market was only recorded in November 2025.
Referring to the history of cycles, Hougan mentioned that crypto winters usually last about 13 months. If the current decline started in January 2025, the possible end of this phase is not far off.
The exact date is crucial for forecasting, as historically the 'crypto winter' lasts about 13 months. If Hougan's calculations are correct, the recovery phase could come soon. However, if Moreno is right, the bear phase may last at least until the third quarter of 2026. In any case, the current period is characterized by the formation of a foundation for the next growth cycle.
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