Bitwise CIO Matt Hougan believes that Trump’s crypto order has the potential to bring down the current cycle

The recent executive order signed by U.S. President Trump regarding cryptocurrency has sparked discussions regarding its potential impact on the four-year cycle of Bitcoin.

The historical data indicates that Bitcoin adheres to a four-year cycle. There are three years of growth and one year of decline. Similarly to BTC, there have been comparable trends since the inception of 2014, 2018, and 2022, with substantial declines.

The Bitwise CIO anticipates that 2025 will be another exceptional year for Bitcoin, following the trends of 2023 and 2024. He stated,

“We are on record as having predicted that the price of Bitcoin will surpass $200,000 this year, as a result of the injections into ETFs and the purchase of Bitcoin by corporations and governments.”

However, he also identified certain indicators of the system’s over-leverage. The number of individuals participating in Bitcoin lending programs, leveraged ETFs, and derivatives trading is increasing. In his opinion, we may be observing a market that is experiencing an inflation. In the past, such circumstances have been followed by sudden adjustments.

President Trump issued an executive order on January 25th that declared the expansion of digital assets to be a national priority. The United States must establish a bitcoin reserve, consider the potential integration of stablecoins into existing markets, and establish appropriate guidelines in accordance with the order.

The Bitwise CIO described this as “overwhelmingly optimistic” for the crypto industry. “The introduction of exchange-traded funds (ETFs) was a significant event that attracted hundreds of billions of dollars in new investor capital to the crypto ecosystem,” he stated. Nevertheless, the complete integration of crypto, as anticipated by Trump’s executive order, will result in trillions.

This executive order also alters Washington’s stance on cryptocurrency regulation. The digital asset working group, which was recently established, is expected to assist in the development of a suitable regulatory framework and mitigate legal risks for institutional investors.

Institutional purchasing has never been this high, as Hougan observed. The approval of spot Bitcoin ETFs in early 2024 facilitated the investment of traditional financial institutions in cryptocurrency.

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