Bitwise CIO says ETF buying hid crypto winter, end near

In a memo to clients late Monday, Bitwise Chief Investment Officer Matt Hougan argued that heavy inflows into crypto exchange-traded funds and corporate treasuries masked a full-blown crypto winter.

He reported that bitcoin is down about 39% from its October 2025 all-time high and ether roughly 53%, with many other tokens posting larger declines. Hougan compared the period with past downturns marked by excess leverage and profit-taking by early holders, when negative mood often kept prices from reacting to good news.

He pointed to data from the Bitwise 10 Large Cap Crypto Index showing that assets with steady institutional demand, including bitcoin, ether and XRP, generally fell about 10% to 20% over the period he examined. Tokens that obtained ETF approval during 2025 saw deeper losses, while assets without institutional access dropped more than 60%.

According to his estimates, ETFs and digital-asset treasuries bought more than 744,000 bitcoin during the downturn, representing roughly $75 billion of demand. He contended that support helped limit bitcoin’s decline; without it, he estimated the drawdown could have approached 60%.

He described the environment as a “Leonardo-DiCaprio-in-The-Revenant-style crypto winter,” saying bearish sentiment has muted reactions to adoption or regulatory developments. “Why is the Crypto Fear and Greed Index near all-time high levels of fear when the new Fed chair is a bitcoin fan? Because we are in a crypto winter,” he wrote.

On timing, Hougan noted that weakness began around January 2025, and that crypto winters have historically lasted about 13 months from peak to trough. He wrote that the current winter has already persisted for more than a year.

Despite recent price declines, his memo cited ongoing progress in regulation, institutional adoption, stablecoins and tokenization. He also listed potential stabilizing catalysts, including strong economic growth, a favorable outcome on the Clarity Act, and indications of sovereign interest in bitcoin. “It’s always darkest before the dawn,” he wrote.

As we reported earlier, spot crypto trading volumes on major exchanges fell to some of the lowest levels since 2024, according to CryptoQuant. Bitcoin traded down about 37.5% from its October peak, as spot demand thinned and risk aversion rose. CryptoQuant’s Darkfost linked the correction to an Oct. 10, 2025 liquidation.