Trump’s crypto order could ‘break Bitcoin’s 4-year cycle’ – Bitwise predicts trillions in new capital

• Trump’s crypto executive order may disrupt the traditional four-year market cycle
• Bitcoin’s price could surpass $200,000 in 2025, driven by ETFs and institutional adoption

Bitwise’s Chief Investment Officer Matt Hougan believes that President Donald Trump’s latest crypto executive order could upend the long-standing four-year boom-and-bust cycle that has defined the crypto market for over a decade.

According to him, this regulatory shift can challenge the widely accepted market pattern, potentially altering how investors approach digital assets.

With growing speculation about Trump’s influence on the crypto industry, this move could mark the beginning of a new market dynamic. It might diverge from historical trends and reshape expectations for the future of cryptocurrencies.

Remarking on the same, Hougan wrote in a note to clients on 29 January. The note said, 

“If we were following the classic four-year cycle, 2025 would be a great year for crypto,” “We’re on the record predicting that bitcoin’s price will double this year to above $200,000, driven by flows into ETFs and bitcoin purchases by corporations and governments. That may turn out to be conservative.”

Bitcoins’ four-year cycle explained

Historically, Bitcoin [BTC] has followed a predictable four-year cycle, with three years of strong gains followed by a significant correction ranging from 58% to 74%. According to Hougan, this pattern has held true, with 2023 and 2024 delivering impressive returns, setting expectations for another strong year in 2025.

However, he believes that investors are beginning to question whether 2026 could bring a market reset.

While many attribute the cycle to Bitcoin’s halving events, Hougan claimed that broader market psychology and speculative behavior play a more significant role, shaped by key industry events such as exchange launches, major collapses, and regulatory crackdowns.

He added, 

The amount of fraud and bad actors in the crypto industry will fall dramatically over the next four years, as leaders like @DavidSacks put in place sensible regulations for crypto. The prior approach of regulation-by-enforcement increased risk to investors. I’m excited for this new era.”

How did this originate?

According to Hougan, the current mainstream crypto cycle emerged from the market turmoil of 2022, marked by the collapse of firms like FTX, Three Arrows Capital, and Celsius.

The turning point came on 10 March 2023, when Grayscale secured an initial victory in its legal battle against the SEC, paving the way for spot Bitcoin ETFs.

Their launch in January 2024 attracted institutional investors, driving Bitcoin’s price from approximately $22,000 to over $100,000 within a year – Signifying crypto’s shift into the mainstream.

Worth pointing out, however, that Hougan sees the timing as the biggest challenge ahead.

What lies ahead?

While regulatory shifts and political developments in Washington favor long-term crypto growth, their full impact may take years to materialize. In fact, if these effects are only felt by 2026, Hougan questioned whether another “crypto winter” in 2025 would align with past market cycles.

He said,

“If BlackRock CEO Larry Fink is calling for $700k bitcoin, are we really going to see a 70% pullback?” 

While the crypto market is evolving, Bitwise’s CIO believes the traditional four-year cycle is not entirely behind us. As the bull market progresses, increasing leverage could still lead to corrections.

However, with the industry’s growing maturity, he expects these downturns to be less severe and shorter in duration, compared to previous cycles.

While volatility remains a factor, the resilience of the crypto space may help cushion future pullbacks, marking a shift in how market cycles play out.

In conclusion, he put it best when he said,

“As for now, it’s full steam ahead. The crypto train is leaving the station.”