Bitwise CIO Matt Hougan Sees Bitcoin Bear Market Weakening
Bitwise Chief Investment Officer Matt Hougan recently noted that Bitcoin has demonstrated remarkable stability despite facing several adverse developments, indicating that the prolonged crypto winter may be close to its bottom. This resilience hints at a possible market turnaround ahead.
Hougan pointed out that Bitcoin weathered multiple tough challenges recently without significant price decline. These included MicroStrategy’s chairman Michael Saylor beginning to liquidate the company's Bitcoin holdings, and the sharp drop in MicroStrategy’s STRC preferred shares to around $75, well below their $100 par value. The market’s subdued reaction to these events suggests growing underlying confidence.
Furthermore, the anticipated US "Clarity Act" saw its approval odds decline from nearly 50% to just above 10%, and a security vulnerability affecting Coldcard hardware wallets—worth about $116 million—was publicly disclosed. Yet Bitcoin’s price remained relatively stable, reinforcing the perception that negative news is increasingly being priced in.
Wealth Management Firms Could Drive Next Phase of Bitcoin Demand
Hougan highlighted that institutional wealth management platforms might become the primary source of Bitcoin inflows moving forward, rather than speculative retail momentum. Despite an overall market decline of roughly 50%, some financial advisors continue to recommend Bitwise’s Solana-staking ETF (ticker: BSOL) to their clients, reflecting sustained institutional demand and strategic asset allocation.
He also mentioned that over the past year, Bitwise facilitated approximately $600–700 million in tax-efficient in-kind ETF conversions, signaling ongoing investor interest and activity within its ETF offerings.
ETF-Focused Asset Allocation for High-Value Bitcoin Holdings
For investors holding around $1 million in Bitcoin, Hougan advises allocating the majority of assets within regulated exchange-traded funds, such as Bitwise’s Bitcoin ETF (BITB). He suggests maintaining a smaller portion in cold storage to balance security and liquidity. Hougan anticipates ETF structures will continue evolving as the market matures.
His view on Bitcoin’s bottom is primarily informed by how the market absorbs adverse news rather than fixed price thresholds. He urges investors to monitor upcoming developments closely to confirm whether Bitcoin’s demonstrated resilience can be sustained.
Presently, Bitcoin’s price action indicates that, despite notable uncertainty, the market has largely digested negative news. With institutional wealth managers entering the space, there could be a stabilizing effect that supports improved market conditions.