Bitwise: Crypto Winter Since Jan 2025 — Institutional Support Masked Deeper Weakness
Bitwise CIO Matt Hougan says the cryptocurrency market has been in a full-scale "crypto winter" since January 2025, driven mainly by excess leverage and large profit-taking by long-term holders. Institutional flows — notably heavy spot-Bitcoin ETF buying and Digital Asset Treasuries (DATs) — purchased roughly 744,000 BTC (~$75bn) during the period, which masked deeper retail-led losses. Without those institutional purchases, Bitwise estimates BTC could have fallen about 60% instead of ~39% from the October 2025 peak; ETH is down roughly 50–53%. Mid- and large-cap assets (BTC/ETH/XRP) saw relatively muted declines (10–20% in Bitwise large-cap measures), while many retail-focused tokens plunged far more (examples: SOL, LTC, LINK down ~37–46%; ADA, AVAX, SUI, DOT down ~62–75%). Historically, crypto winters average around 13 months and typically end through seller exhaustion and sentiment normalization rather than positive news. Bitwise argues the market may be nearer the trough now, helped by structural tailwinds — stronger regulatory clarity, continued Wall Street adoption, growth in stablecoins and tokenization — that could enable a faster recovery once selling pressure eases. For traders: expect continued dispersion between ETF-/institutionally supported assets and retail tokens, a likely gradual reduction in selling pressure, and the possibility of a quiet stabilization before any sustained rally.
Neutral
The news frames the decline as a structural "crypto winter" driven by leverage and profit-taking, but it also highlights large institutional purchases (ETFs and DATs) that materially cushioned BTC’s fall. Short-term impact: mixed/neutral — institutional demand has limited further downside for BTC relative to retail tokens, so abrupt collapses are less likely for BTC but volatility remains elevated. Traders should expect continued dispersion: ETF-backed BTC (and other institutional-accessible assets) may trade with relative stability, while retail-focused tokens could underperform. Long-term impact: cautiously constructive — Bitwise cites regulatory progress, Wall Street adoption, stablecoins and tokenization as latent supports that could speed recovery once selling exhausts. Overall, the immediate price implication for BTC is neither strongly bullish nor bearish; the story suggests stabilization and a potential recovery later, not an imminent sustained rally.