In 2026, Bitcoin is expected to rise, but the shocking events of early February did not mark the final bottom for the asset. This was stated by Bitwise's Chief Investment Officer, Matt Hougan, on the Blockspace podcast.

The expert referred to the drop in the price of the leading cryptocurrency on February 6 to $60,000, which set a new low since September 2024.

As of this writing, the price has recovered to above $68,000 (CoinGecko). However, Hougan suggests that the asset's correction may not be over:

"It’s common to see one or two major shocks. I wouldn’t be surprised to see a similar event happen again in the future."

He disagreed with the view that the record liquidation on October 11, exceeding $19 billion, marked the beginning of a bear market. According to Hougan, the crypto winter began in January 2025 following the inauguration of U.S. President Donald Trump, at which point a sell-off began beyond Bitcoin and Ethereum.

Institutional investors reacted slowly to the situation, leading to the $19 billion loss. This event confirmed the onset of the crypto winter, causing both leading digital assets to plummet.

Historically, Bitcoin's price movements have occurred within four-year cycles linked to halvings. After the block reward is halved, the asset's price typically rises before crashing by as much as 80-90%.

Hougan believes that with the influx of major players into the industry, the depth of such declines will shrink to 50-60%. He attributed this to the fact that institutional and retail traders operate in different cycles—when one group sells, the other may buy.

"This is the new reality we find ourselves in," said Hougan.

Worrisome Signals for Bitcoin

Retail traders holding less than 0.01 BTC are aggressively buying cryptocurrency at every minor price dip. In contrast, institutional investors (holding 10-10,000 BTC) have sold a "huge volume" of the asset over the past five weeks, noted Santiment.

Experts from the firm described this divergence as "worrisome."

"Historically, sustainable bull markets require accumulation by 'smart money,' not retail purchases during dips," they explained.

Santiment specialists pointed out another negative trend for Bitcoin: on-chain transaction volumes, the number of new addresses, and network growth rates are steadily declining.

"Real market expansion should be supported by increased user activity, which is currently lacking," the experts noted.

However, they also highlighted some positive signals:

  • The number of extremely optimistic price predictions for Bitcoin on social media has decreased, which is a "healthy market indicator";
  • The 30-day MVRV ratio for the leading cryptocurrency stood at -6, indicating a relatively high probability of a recovery rally.

No Quick Bounce Expected

Bitcoin rarely forms V-shaped bottoms outside of economic stimulus periods, such as during COVID-19. When reaching a bottom, the asset typically remains at that level for an extended period. This was stated by macroeconomist Lyn Alden on the Coin Stories podcast.

"I think we are currently in a state of stagnation," she noted.

During this "prolonged phase," the price could drop another $10,000-20,000, Alden acknowledged.

She believes that a peak in AI company stocks could serve as a catalyst for the next major rally of the leading cryptocurrency. Once investors realize that this segment is no longer growing as rapidly as before, they will start looking for potentially profitable investments.

Bitcoin could be one of those assets. Alden explained that for digital gold to resume its growth, it does not require a massive influx of capital—just a slight increase in demand.

Recall that Hougan identified the DeFi sector as a potential driver that could pull the crypto market out of its prolonged correction.