Bitcoin’s four-year cycle could be shattered as Wall Street floods in, with trillions poised to flow after a game-changing executive order cements crypto’s mainstream dominance.
Full Mainstreaming of Crypto Could Break Bitcoin’s Four-Year Cycle—Trillions Await
Matt Hougan, the chief investment officer at Bitwise Asset Management, released an analysis on Jan. 28 exploring the potential impact of President Donald Trump’s recent executive order on bitcoin’s well-established four-year cycle.
“Last week, President Trump issued an executive order that was so overwhelmingly bullish for the space that it’s making me wonder,” he wrote. “The EO [executive order] called it a ‘national priority’ to grow the digital asset ecosystem in the U.S. It laid the path for a clear regulatory framework for crypto. It contemplated establishing a ‘national crypto stockpile.’ Together with actions taken by the now pro-crypto SEC, it created a pathway for the largest Wall Street banks and investors to move aggressively into the space,” the Bitwise CIO detailed.
Bitcoin ETFs have drawn substantial investment, but Hougan suggested this executive action could further expand adoption. He noted that ETFs have attracted new investors, driving the current cycle. While emphasizing that ETFs attracted hundreds of billions from new investors, driving the current cycle, he stressed:
But the full mainstreaming of crypto—the one contemplated by Trump’s executive order… I’m convinced will bring trillions.
The Bitwise executive analyzed bitcoin’s historical behavior, pointing to its recurring four-year pattern. “Bitcoin has historically moved in a four-year cycle, with three big up years followed by a pullback,” he stated. The latest cycle, he explained, emerged from the widespread deleveraging caused by major collapses in 2022, including FTX, Three Arrows Capital, Genesis, Blockfi, and Celsius. “At Bitwise, we call this cycle the ‘Mainstream Cycle,’ and we believe its defining characteristic is the entry of mainstream investors into the crypto space,” he elaborated.
With bitcoin already surpassing $100,000, he projected further gains. “If we were following the classic four-year cycle, 2025 would be a great year for crypto. And I think it will be… We’re on the record predicting that bitcoin’s price will double this year to above $200,000,” he asserted.
Cautious optimism shaped his outlook, as he acknowledged potential market corrections. “My guess is that we haven’t fully overcome the four-year cycle. Leverage will build up as the bull market builds. Excess will appear. Bad actors will emerge,” he noted. However, he believes any downturn will be shorter and less severe than in previous cycles, stating:
My guess is that any pullback will be shorter and shallower than in years past.
Institutional investment and clearer regulations continue to strengthen his confidence in bitcoin’s trajectory. “As for now, it’s full steam ahead. The crypto train is leaving the station,” he concluded.
