Bitwise CIO: This is a harsh 'crypto winter,' not just a correction

Matt Hougan, Chief Investment Officer (CIO) at Bitwise, has assessed the current cryptocurrency market as a full-blown crypto winter, not merely a correction. According to The Block, he noted that the current market shows a very similar pattern to the crypto winters of 2018 and 2022, when the overall market downturn continued even amid positive news like expanding crypto adoption or regulatory improvements. "Despite the newly appointed Federal Reserve Chairman being a pro-Bitcoin figure, market sentiment remains at a level of extreme fear," Hougan said, calling it proof that a full-scale crypto winter has already begun. He argued that while Bitcoin hit a new high last October, the downtrend had already started in January, but strong inflows into ETFs and digital asset trusts (DATs) temporarily masked the bearish trend. While it is difficult to predict the exact timing of a recovery, Hougan believes the market is now closer to a gradual recovery than to further declines. He pointed out that the crypto winter has already lasted for over a year and that past downturns ended not with public enthusiasm but with fatigue, similar to the current market atmosphere. Potential catalysts for a rebound, he added, include U.S. economic growth, legislative discussions on market structure bills like the CLARITY Act, and the possibility of nation-state Bitcoin adoption.