Bitwise: Bitcoin bottom rising—most mild structural bear market this cycle
Bitwise senior strategist Juan Leon tells The Block that this Bitcoin bear market is structurally different from past cycles. He argues institutional participation is “accelerating,” and the current drawdown is the “mildest” one: about a 50% decline versus 78% in 2022 and 84% in 2018.
Leon highlights multiple “Bitcoin bottom” signals: oversold momentum indicators, roughly half of holders underwater, long-term holders re-accumulating, and June spot Bitcoin ETF flows hitting record outflows. He frames the main drag as macro—sticky inflation, geopolitics, and capital rotation toward AI—rather than crypto fundamentals. He also notes AI and crypto may become complementary: agentic AI could rely on programmable money and stablecoin payments.
Bitwise CIO Matt Hougan previously said STRC sell-offs look like late-cycle deleveraging, which historically often precedes the start of a new bull phase. For traders, the message is that downside may be less severe than prior cycles, while timing hinges on ETF flow stabilization and whether macro pressures ease.
Overall, the “Bitcoin bottom” thesis suggests potential for support and gradual accumulation, but it does not confirm an immediate trend reversal.
Neutral
This news is best read as “bear market with bottoming signals,” not a confirmed reversal. Bitwise’s case is that the current drawdown is structurally milder (≈50% vs 2022/2018’s ~78–84%), and several indicators align with a Bitcoin bottom process: oversold momentum, widespread unrealized losses (about half of holders), long-term re-accumulation, and a clear sell-pressure proxy via June spot Bitcoin ETF record outflows.
However, the article does not claim that ETF outflows have flipped positive or that macro conditions (sticky inflation, geopolitics, AI-driven capital rotation) have eased. That keeps the near-term trade more reactive than directional: rallies may face supply, while breakdowns remain possible until ETF flows stabilize.
Historically, “late-cycle deleveraging” narratives (e.g., similar de-risking phases around prior cycle lows) can precede a new bull run, but timing is uneven. So the most actionable interpretation for traders is to watch BTC ETF flow inflection points and whether the re-accumulation trend persists—support-building could emerge, but trend confirmation likely requires follow-through beyond this stage.