The end of the “crypto winter” is near, and here are the reasons to remain optimistic, according to Matt Hougan.

Bitwise's Matt Hougan believes the crypto winter started earlier than expected, but that Bitcoin's current capitulation could be the prelude to a historic recovery in 2026.

The cryptocurrency market is listening, but what it's hearing isn't exactly encouraging. Now, what many investors tried for months to dismiss as a simple "technical correction" or a "bump in the road" after the October 2025 highs is finally revealing itself to be something much more frigid. Hougan, like other experts, points out that we're in a full-blown crypto winter, one reminiscent of the harshness of 2022, where optimism freezes and only the most patient capital survives. 

Bitcoin, the cornerstone of the crypto industry's disruptive innovation, has fallen nearly 40% from its all-time high in October, and the ecosystem appears to be caught in a spiral of missing out on good news. 

However, amid this scenario of capitulation, Bitwise's investment director maintains a thesis that breaks the narrative of panic: the end of the cryptocurrency bear market is not only inevitable, but is much closer than the price charts suggest today.

The institutional mirage and the reality of the retail investor

Matt Hougan has posed a question that makes more than a few people on Wall Street uncomfortable. If the signs regarding institutional adoption and regulation are more favorable than ever, Why are crypto market prices still falling? The answer, according to him, dates back to the recent past. 

In her publication “The Depths of Crypto Winter”Hougan wrote that the cryptocurrency winter began in January 2025, although it took many months to recognize it. In his view, during the past year, the market experienced an illusion of growth Sustained by massive capital inflows from ETFs and Digital Asset Treasuries, institutions poured around $75.000 billion into Bitcoin, accumulating over 640.000 BTC. This money acted as a bulwark, masking an uncomfortable reality: small investors were already quietly pulling out.

According to Hougan, without that institutional support, the current situation would be far more critical. Bitcoin would have plummeted to levels close to 70% below its current value. He explained that this imbalance created a new hierarchy within the market. On one hand, there are assets that remain under the protection of large capital, such as Bitcoin and Ethereum. On the other, there are those that achieved some media exposure along the way. And finally, there are those that lost favor with both the public and institutions, citing ADA, AVAX, and DOT as examples, whose prices have plummeted by up to 75% in the last year. 

“It’s important to call it what it is. This isn’t a ‘bull market correction’ or a ‘crash.’ It’s a full-blown crypto winter, 2022-style, triggered by factors ranging from excessive leverage to widespread profit-taking by OGs.”, Emphasized. 

However, despite the prolonged correction in the price of Bitcoin and cryptocurrencies, the expert points out that the scenario does not reflect a failure of innovation, but rather a profound adjustment process. The market is purging the excess leverage that accumulated during the years of exuberance. The correction of the last few days demonstrates the strain that major assets are experiencing: Bitcoin fell 20 percent, reaching 69,000 dollars, while Ethereum struggles to stay above 2,000. This pressure has put companies that adopted aggressive treasury strategies, such as Strategy and Bitmine, under scrutiny, confronting them now with a much less accommodating financial reality.

Bitcoin's potential energy after the market purge

According to Hougan, if Bitcoin weren't the disruptive technology it is, the crypto market would be stuck in an endless winter. For the expert, the reality is that the foundations and principles supporting the cryptocurrency—the code, decentralization, and scarcity—remain intact and haven't changed a single thing. However, he warns that periods of stagnation don't end with euphoria, but rather with a silent pause that reveals collective weariness. That stillness, he says, marks the point where we now find ourselves.

When the market systematically ignores Wall Street hiring crypto experts or major banks like Morgan Stanley integrating these assets, it's not because the news is bad, but because the market is too fatigued to react. This lethargy of good news generates what physicists would call potential energy. Every regulatory advancement and every step toward the tokenization of real-world assets (RWAs) is a spring being compressed. 

In addition to Hougan, analysts at firms like Bernstein suggest that this tension could unleash its full force with a final capitulation, temporarily driving the price down to levels near $58.000 or $60.000. For the average investor, this might sound alarming; however, for those who understand market cycles, it's a necessary clearance before the next rally.

According to the publication, experience suggests that market corrections typically last around thirteen months from peak to trough. Therefore, Hougan predicts that if the current decline began in January 2025, the turning point could be much closer than it appears.