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Bitwise argues crypto is near the end of a brutal winter

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Bitwise argues crypto is near the end of a brutal winter

Prices have been falling since early 2025, masked by institutional flows, but history suggests the worst may already be behind us, Bitwise said.

By Will Canny, AI Boost|Edited by Nikhilesh De
Feb 3, 2026, 2:36 p.m.
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Bitwise Chief Investment Officer Matt Hougan. (CoinDesk Archives)

What to know:

  • Bitwise said the crypto market has been in a full-scale winter since January 2025.
  • Institutional ETF and treasury flows masked deeper weakness in retail crypto.
  • Past cycles suggest crypto winters end in exhaustion, and this one may be close.

Crypto has been in a full-blown winter since January 2025, even if much of the market has been reluctant to say it out loud, asset manager Bitwise said in a Monday blog post.

Having lived through multiple crypto winters, the investment manager said the current mood of despair looks familiar, and historically has marked the later stages of downturns. After more than a year of declining prices, the market is likely closer to the end of winter than the beginning, with a recovery arriving “sooner rather than later.”

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Crypto winters are prolonged bear markets marked by steep price declines, collapsing sentiment and a general indifference to good news. Historically, they have followed periods of excess leverage and speculative excess, lasting roughly a year from peak to trough.

In past cycles, including 2018 and 2022, adoption milestones and regulatory progress did little to halt losses in the depths of the downturn. Instead, crypto winters have tended to end quietly, as selling pressure fades and markets stabilize, setting the stage for the next expansion, the post said.

Prices have been sharply lower across the board, with bitcoin BTC$77,863.73 down roughly 39% from its October 2025 peak, ether ETH$2,288.28 off more than 50%, and many major tokens down far more.

This is not a routine pullback or a healthy correction, according to Bitwise CIO Matt Hougan, but a 2022-style downturn driven by excess leverage and profit-taking that has overwhelmed even a steady stream of positive headlines.

Hougan argued that recognizing the market as a true crypto winter helps explain why good news, from regulatory progress to institutional adoption, has failed to lift prices.

In past cycles, Hougan noted, fundamentals rarely matter at market lows. Crypto winters do not end with optimism or excitement, but with fatigue, as sellers are finally exhausted.

While previous crypto winters have lasted roughly 13 months from peak to trough, Hougan believes this cycle effectively began in January 2025, even though the market did not fully register it at the time. Heavy inflows into spot bitcoin exchange-traded funds (ETFs) and digital asset treasury strategies helped prop up a handful of large, institutionally accessible assets, masking a brutal bear market in retail-focused crypto.

According to the report, assets with strong institutional support fell modestly in 2025, while tokens without ETF or treasury demand suffered declines of 60% or more. Bitwise estimated that institutional vehicles absorbed more than 740,000 bitcoin during the period, providing tens of billions of dollars in price support that may have prevented far steeper losses.

Despite the gloom, the underlying story for crypto has not materially deteriorated, according to Hougan.

Regulatory momentum, Wall Street adoption, stablecoins and tokenization all continue to advance, even if markets are ignoring them for now. That positive news is building latent pressure that could fuel a sharp recovery once sentiment turns, the report added.

Read more: Wall Street integration will power crypto’s next phase, says Fidelity Digital Assets

Crypto WinterDigital Asset TreasuryETFsBitwise
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BitcoinWorld Crucial US Stock Market Update: What Wednesday’s Mixed Close Reveals The financial world often keeps us on our toes, and Wednesday was no exception. Investors watched closely as the US stock market concluded the day with a mixed performance across its major indexes. This snapshot offers a crucial glimpse into current investor sentiment and economic undercurrents, prompting many to ask: what exactly happened? Understanding the Latest US Stock Market Movements On Wednesday, the closing bell brought a varied picture for the US stock market. While some indexes celebrated gains, others registered slight declines, creating a truly mixed bag for investors. The Dow Jones Industrial Average showed resilience, climbing by a notable 0.57%. This positive movement suggests strength in some of the larger, more established companies. Conversely, the S&P 500, a broader benchmark often seen as a barometer for the overall market, experienced a modest dip of 0.1%. 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Even small movements in major indexes can signal shifts that require attention, guiding future investment decisions within the dynamic US stock market. What’s Next for the US Stock Market? Looking ahead, investors will be keenly watching for further economic indicators and corporate announcements to gauge the direction of the US stock market. Upcoming inflation data, statements from the Federal Reserve, and quarterly earnings reports will likely provide more clarity. The interplay of these factors will continue to shape investor confidence and, consequently, the performance of the Dow, S&P 500, and Nasdaq. Remaining informed and adaptive will be key to understanding the market’s trajectory. Conclusion: Wednesday’s mixed close in the US stock market highlights the intricate balance of forces influencing financial markets. While the Dow showed strength, the S&P 500 and Nasdaq experienced slight declines, reflecting a nuanced economic landscape. 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A3: Mixed performances in the US stock market can be influenced by various factors, including specific corporate earnings, economic data releases, shifts in interest rate expectations, and broader geopolitical events that affect different market segments uniquely. Q4: How should investors react to mixed market signals? A4: Investors are generally advised to maintain a long-term perspective, diversify their portfolios, stay informed about economic news, and avoid impulsive decisions. Consulting a financial advisor can also provide personalized guidance for navigating the US stock market. Q5: What indicators should investors watch for future US stock market trends? A5: Key indicators to watch include upcoming inflation reports, statements from the Federal Reserve regarding monetary policy, and quarterly corporate earnings reports. These will offer insights into the future direction of the US stock market. Did you find this analysis of the US stock market helpful? 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