Bitwise CIO: Bitcoin’s Explosive Growth Era Ends as Market Matures Beyond Boom-Bust Cycles

Bitcoin's wild ride might be settling into a steadier climb. According to Bitwise's Chief Investment Officer, the digital gold's era of parabolic, cycle-driven surges is giving way to a new phase of maturity.

The New Normal: Growth at a Sustainable Pace

Forget the heart-stopping 10x rallies followed by brutal 80% drawdowns. The narrative is shifting from a speculative asset beholden to four-year halving cycles to an institutional-grade financial instrument. The CIO argues that as adoption broadens—think spot ETFs, corporate treasuries, and sovereign wealth funds—the price discovery mechanism becomes less about retail frenzy and more about measured capital allocation. Volatility doesn't vanish, but its extremes get tempered by deeper liquidity and longer-term holders.

What's Driving the Slowdown?

It's not a lack of demand, but a change in its character. Early growth came from a near-zero base, where any new user or dollar had an outsized impact. Now, with a market cap measured in trillions, moving the needle requires inflows of a different magnitude. The infrastructure is also evolving; regulated custodians, sophisticated derivatives, and clearer tax frameworks attract capital that's allergic to the wild west days. It's the financialization of an asset class, a process that inevitably sands off the roughest edges—and the most spectacular gains.

A Mature Market Isn't a Boring One

This evolution doesn't spell doom for returns. It simply redefines them. Growth may decelerate from 'astronomical' to 'merely exceptional' compared to traditional assets. The focus turns to Bitcoin's core value propositions: a decentralized store of value, a hedge against monetary debasement, and a non-correlated asset in a diversified portfolio. The thesis becomes less about timing the next hype cycle and more about capturing the long-term re-rating of a global digital commodity. After all, even gold had its manic phase before settling into its role as a perennial portfolio ballast.

The bottom line? Bitcoin isn't fading—it's graduating. The days of easy 1000% gains from cycle plays might be over, replaced by the harder, but perhaps more respectable, work of building foundational value. For the crypto faithful, it's a sign of success. For Wall Street, it's just another asset to slice, dice, and package into a fee-generating product—proving that even the most revolutionary technologies eventually get a collar and tie.

TLDR

• Bitwise CIO Matt Hougan said Bitcoin is entering a phase of slower and steady growth.
• He explained that institutional demand is helping reduce volatility in the Bitcoin market.
• Bitcoin fell from its peak of $126,200 in October to around $87,000, a 30 percent drop.
• Hougan stated that past cycles saw deeper corrections which were often driven by retail selling.
• Sebastian Beau from ReserveOne said it is still unclear if Bitcoin’s four-year cycle remains valid.

Bitcoin may be entering a new era of moderate and steady growth, according to Bitwise Chief Investment Officer Matt Hougan. Speaking to CNBC, Hougan confirmed Bitcoin’s market behavior has shifted due to structural maturity. He stated that future price movements will likely be more gradual, not driven by short-term spikes.

Institutional Growth Eases Volatility

Hougan pointed to stronger institutional participation as a reason behind Bitcoin’s reduced volatility. He explained that consistent buying from institutions is now limiting the scale of market downturns.

“Drawdowns are smaller today because the market is more mature,” Hougan said.

The cryptocurrency dropped from its October high of $126,200 to around $87,000, a decline of roughly 30%. This contrasts with previous cycles where declines reached 60%, often triggered by retail panic. Hougan said institutions have been absorbing supply from retail investors exiting before year-end.

This shift has prevented deeper corrections and supported a more stable market environment. Hougan expects this pattern to continue into 2026. He believes long-term gains will still accumulate, but without the intensity of earlier rallies.

Bitcoin Cycle Debate Continues

While Hougan maintains an optimistic stance, not all analysts agree on Bitcoin’s future trajectory. Sebastian Beau, CIO at ReserveOne, said it remains unclear whether historical four-year cycles still apply. He noted the October peak and subsequent 30% drop mirror past cycle tops.

Beau said, “Some investors see this timing as a warning of potential weakness in 2026.”

His comments indicate that cycle-based concerns remain active. Bitcoin’s price performance is still being viewed through the lens of previous market phases.

Veteran trader Peter Brandt also issued a cautionary note regarding the 2026 outlook. He predicted Bitcoin could retreat to $60,000 by Q3 2026. Brandt’s view contrasts with Hougan’s expectation for continued institutional support.

Pssst….
This is this trendline I have defined as curved while all the rookie chartists out their keep referring to as straight
What say you? Curved or straight?
Hey rookies, now is the time for you to reply showing your chart with a line improperly connecting two low points pic.twitter.com/DHlMLsPeFG

— Peter Brandt (@PeterLBrandt) December 17, 2025

Politics and Regulation Play Smaller Role

Bitcoin saw a surge to $109,000 early in 2025 following Donald Trump’s inauguration as U.S. president. Hougan said the event triggered retail interest but may not sustain further growth. He added that future political events are unlikely to drive large price moves.

Regulatory uncertainty has eased after the U.S. SEC clarified Bitcoin’s status as a commodity. Hougan said this has removed a major source of investor hesitation. Beau agreed, noting regulatory risk has already been priced into current valuations.

With these factors resolved, market attention has shifted back to adoption and long-term positioning. bitcoin is currently trading at $89,561, down 1.1% over the past 30 days. Despite the dip, the market shows no signs of panic or financial stress.

Institutional accumulation continues to counter retail-driven selling pressure. This dynamic may define Bitcoin’s future path as volatility gradually declines. Long-term investors are now adjusting expectations toward measured and sustained growth.