Matt Hougan, Chief Investment Officer (CIO) at Bitwise Asset Management, said the market is experiencing a crypto winter.
According to his analysis, the crypto winter began in January 2025, but heavy institutional inflows “papered over that truth,” masking the depth of the downturn. The key question now is, how long will the winter last?
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Market Weakness Signals an Ongoing Crypto Winter
In a recent market commentary, Hougan rejected the idea that recent price weakness represents a temporary pullback. Instead, he described the current environment as a “full-blown crypto winter,” pointing to steep drawdowns across major assets.
He highlighted that Bitcoin (BTC) is now trading about 39% down from its October 2025 all-time high. Meanwhile, Ethereum (ETH) has fallen roughly 53%. Many altcoins have declined far more.
“This is not a ‘bull market correction’ or ‘a dip.’ It is a full-bore, 2022-like, Leonardo-DiCaprio-in-The-Revenant-style crypto winter—set into motion by factors ranging from excess leverage to widespread profit-taking by OGs,” Hougan noted.
Institutional demand, he said, played a key role in masking the downturn. Using data from the Bitwise 10 Large Cap Crypto Index, Hougan highlighted a clear divide.
Assets with strong institutional support, such as Bitcoin, Ethereum, and XRP (XRP), have posted relatively modest declines since January 2025. Tokens that gained ETF access in 2025, like Solana (SOL), Chainlink (LINK), and Litecoin (LTC), suffered deeper losses.
Nonetheless, assets without any institutional exposure fell between roughly 60% and 75%. According to him,
“The thing that separates the three groups is basically whether or not institutions had the ability to invest in them.”
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During this period, exchange-traded funds (ETFs) and Digital Asset Treasuries (DAT) accumulated more than 744,000 Bitcoin, worth an estimated $75 billion. Hougan argued that without this level of institutional support, Bitcoin’s losses would likely have been far greater.
“Retail crypto has been in a brutal winter since January 2025. Institutions just papered over that truth for certain assets for a while,” the executive remarked.
Hougan also addressed a question many market participants have raised: why do crypto prices continue to fall despite positive developments such as increased institutional adoption, regulatory progress, and broader acceptance by Wall Street?
His answer was straightforward. In the depths of a crypto winter, good news typically has little immediate impact on prices.
“Those of you who followed crypto during past winters—either 2018 or 2022—will remember that good news doesn’t matter in the depths of winter. Crypto winters don’t end in excitement; they end in exhaustion,” he added.
However, he suggested that while positive developments are often ignored during bear markets, they do not disappear. Instead, they accumulate as what he described as “potential energy,” which can fuel a recovery once sentiment improves.
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Hougan pointed to several factors that could help lift market sentiment, including stronger economic growth that triggers a risk-on rally, a positive surprise related to the Clarity Act, signs of sovereign adoption of Bitcoin, or simply the passage of time.
Looking at historical cycles, Hougan said crypto winters typically last around 13 months. If the current winter indeed began in January 2025, then it’s possible that the end may be near.
He stressed that the prevailing mood of despair and malaise often characterizes the final phase of a crypto winter and stressed that nothing fundamental about crypto has changed during the current pullback.
“I think we’re going to come roaring back sooner rather than later. Heck, it’s been winter since January 2025. Spring is surely coming soon,” Hougan claimed.
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When Did Crypto Bear Market Start: Debating the Timeline
Though Hougan traces the bear market’s start to January 2025, not all analysts concur. Julio Moreno, Head of Research at CryptoQuant, acknowledged differences in asset performance due to institutional exposure but disputed the timeline.
“I disagree with the winter starting in January 2025. Bitcoin prices remained in a long-term upward trend throughout 2025, and reached a new ATH in October. The fact that we did not have a blow-off top or closed the year positive doesn’t mean we were in a bear market in 2025. The Bitcoin bear market started on November 2025, as suggested by on-chain and market data,” he posted.
The start date matters. Historically, crypto winters last about 13 months. If the downturn began in January 2025, a spring recovery could be near. If Moreno is right and the market peaked in November 2025, the bear phase would continue.
“The timing has implications for when it will end. My current expectation is Q3 2026,” Moreno wrote.
Whether recovery comes early in 2026, as Hougan predicts, or is pushed to Q3 under Moreno’s timeline, remains to be seen. What is clear, however, is that the market is deep in a downturn.
History suggests these phases do not end with a single catalyst but rather over time. If past cycles are any guide, the groundwork for the next recovery may be forming beneath the surface.
