Is Bitcoin’s Four-Year Cycle Breaking? Bitwise Weighs In

The Cycle That Has Defined the Crypto Market

For years, Bitcoin’s market has followed a predictable cycle: three years of growth, followed by a sharp correction. But despite common belief, this pattern isn’t directly linked to Bitcoin’s halving—it’s more closely tied to broader economic trends, with crypto’s volatility amplifying the effects.

Each major bull run has been fueled by a technological breakthrough that attracted fresh capital:

• Early 2010s: The rise of crypto exchanges like Coinbase and Mt. Gox, which opened the market to retail investors.
• 2017: The ICO boom drove a wave of speculative investments before an SEC crackdown triggered a crash.
• 2021: Institutional adoption of Bitcoin sparked a price surge, followed by financial crises driven by excessive leverage and fraud.

Now, Hougan is questioning whether this long-standing cycle is shifting.

The Mainstream Cycle and Its Catalyst

The current bull market began in 2023, following a period of mass liquidations. After the collapses of FTX, Three Arrows Capital, and Celsius, many doubted whether the crypto market could recover.

Then came a key catalyst: Grayscale’s legal victory against the SEC, which led to the approval of spot Bitcoin ETFs. When these ETFs launched in 2024, they exceeded all expectations, fueling unprecedented institutional demand.

Related: Rachel Aguirre Reflects on IBIT’s First Year in Action

The market’s response was immediate. 

When Grayscale first took on the SEC, Bitcoin was trading at $22,218. Today, it has surged past $102,000.

With ETFs making Bitcoin more accessible to institutional investors, governments and corporations have also started increasing their crypto holdings.

According to Matt Hougan, Bitcoin could reach $200,000 by the end of 2025.

But a bigger question: will Bitcoin’s four-year cycle hold?

Trump’s Executive Order: A New Era for Crypto?

In mid-January 2025, Donald Trump signed an executive order that could radically transform the future of the crypto market. The order designates digital assets as a national priority and lays the foundation for:

• A clear regulatory framework
• The creation of a national cryptocurrency reserve
• Mass institutional adoption

For years, regulatory uncertainty has been a major barrier for institutional investors. Now, that’s changing. The SEC, once hostile toward crypto, is shifting toward a more supportive stance, opening the door for Wall Street’s largest financial institutions to enter the market.

While Bitcoin ETFs have already attracted hundreds of billions into the crypto economy, Trump’s executive order could bring in trillions.

Will This Break Bitcoin’s Traditional Cycle?

Historically, Bitcoin has followed a four-year cycle, with 2025 expected to be a year of strong growth, followed by a market downturn in 2026.

Many analysts anticipate that rising leverage and speculative capital will eventually trigger another correction.

Some warning signs are already emerging:

1. Companies are aggressively raising capital to buy Bitcoin.
2. Bitcoin-backed lending programs allow investors to borrow against their holdings without selling.
3. Speculative activity is surging through derivatives, ETFs, and structured financial instruments.

Under normal circumstances, these trends would reinforce Bitcoin’s traditional boom-and-bust cycle. However, Matt Hougan believes that Trump’s executive order could fundamentally alter the market structure.

A clear regulatory framework could bring in a new wave of long-term investors, shifting Bitcoin’s perception from a highly speculative asset to a core financial instrument. If major banks start holding Bitcoin alongside traditional assets, the anticipated 2026 market downturn may not happen at all.

What’s Next for the Crypto Market?

The full impact of Trump’s executive order won’t be immediate. Regulatory frameworks will take time to develop, and financial institutions won’t adapt overnight.

But if 2025 marks the beginning of a long-term shift, is a market downturn in 2026 still inevitable?

According to Matt Hougan, the crypto market has matured significantly. Bitcoin is now held by governments, corporations, and institutional funds, making the market more resilient to sharp corrections.

While a pullback is still possible, Hougan believes it will likely be less severe and shorter-lived than in past cycles. If Wall Street and global regulators continue supporting crypto, 2026 may not bring another crypto winter at all.

For now, the takeaway is clear: the crypto bull market is far from over. And this time, it may not stop at all.

Profile: Matt Hougan, Chief Investment Officer at Bitwise

Matt Hougan is a recognized expert in cryptocurrencies, exchange-traded funds (ETFs), and financial technology.

As Chief Investment Officer at Bitwise Asset Management—the world’s largest provider of crypto index funds, managing over $1.5 billion in assets—Hougan oversees investment strategy development and the creation of new financial products.

Before joining Bitwise, Hougan served as CEO of ETF.com and Inside ETFs, where he played a key role in developing the first-ever ETF analytics platform, launching a leading ETF-focused media outlet, and organizing the world’s largest ETF conference. 

Hougan also co-authored influential works for the CFA Institute Research Foundation, including:

• “A Comprehensive Guide to Exchange-Traded Funds”
• “Cryptoassets: The Guide to Bitcoin, Blockchain, and Cryptocurrencies for Professional Investors”

Through his expertise in digital assets and investment innovation, Matt Hougan continues to shape the future of financial technology, advocating for broader access to crypto investments and driving the next wave of financial evolution.