Bitwise Declares: Q4 2025 May Have Been the Crypto Bear Market’s Final Chapter
Forget the whispers—Bitwise just shouted it from the digital rooftops. The crypto winter that froze portfolios and rattled nerves might finally be over. The asset manager's latest analysis points to a definitive shift, suggesting the fourth quarter of last year wasn't just a rally; it was a regime change.
The Turning Tide
What changed? The data tells a story of resurgence. Trading volumes surged back to life, institutional capital began trickling—then flowing—back into the space, and key network metrics across major blockchains snapped their multi-year slumps. This wasn't a speculative blip driven by memes; it was a broad-based recovery built on real, on-chain activity. The fear that dominated 2023 and much of 2024 has been decisively replaced by a cautious, calculating greed.
A New Foundation for Growth
The landscape looks fundamentally different now. Regulatory clarity, while still a patchwork, has advanced in critical jurisdictions. Institutional-grade infrastructure is no longer a promise—it's operational. And the underlying technology has quietly matured through the bear market's grind, solving scalability issues that once seemed intractable. The market is building on concrete, not sand. (A novel concept for finance, where most new products are built on hope and a PowerPoint slide.)
The path forward isn't guaranteed to be a straight line up—volatility remains crypto's middle name—but the direction of travel appears set. The bear's grip has loosened. The question for 2026 isn't about survival anymore; it's about how high the next cycle can climb.
Bitwise’s Hougan Draws Parallels Between Today’s Market and Post-FTX 2023
Hougan compared the current setup to early 2023, when markets were still reeling from the collapse of FTX.
At the time, crypto prices appeared directionless despite signs of recovery under the surface. bitcoin rebounded from lows near $16,000 and ultimately surged to around $98,000 by the start of 2025.
“At the time, we were starting to rebound post-FTX, and the data was topsy-turvy; some up, some down, some sideways,” Hougan said. “In the two years that followed, crypto prices soared.”
According to Hougan, the same divergence between sentiment and fundamentals emerged again in late 2025. While asset prices pulled back, key indicators across the crypto economy moved sharply higher.
The latest Bitwise crypto market Review just dropped—and it’s the most important one we’ve ever published.
Why? Because it shows a tension in crypto markets that has historically signaled a bear-market bottom (see Q1 2023).
Receipts: During Q4 2025…
– ETH’s price fell 29% ……
The outlook for 2026, however, remains a point of debate among analysts.
Fundstrat head of research Tom Lee has warned that macro headwinds, including trade tariffs and political uncertainty, could weigh on markets for much of the year before a late rebound.
By contrast, VanEck expects the first quarter of 2026 to favor “risk-on” assets such as crypto, citing greater fiscal clarity and signs of stabilization in the U.S. economy.
Hougan highlighted four trends from Q4 that he believes strengthen the case for a market bottom.
Ethereum and layer-2 networks saw transaction volumes climb to record levels, suggesting growing real-world usage.
At the same time, revenues among crypto-focused companies outpaced many traditional sectors in the stock market.
Stablecoin Market Hits Record $300B as Transaction Volumes Surge
Stablecoins also played a central role. Transaction volumes and assets under management surged throughout 2025, with total stablecoin market capitalization surpassing $300 billion in Q4, marking a new all-time high.
Decentralized finance adoption rounded out the list. Hougan pointed to Uniswap, noting that the decentralized exchange now consistently processes more transaction volume than Coinbase.
“That’s the kind of divergence you get at the bottom of bear markets, when sentiment is down but fundamentals are up,” he said.
Bitwise added that several potential catalysts could push crypto markets higher in 2026, including progress on the CLARITY Act, continued growth in stablecoins, a new Federal Reserve chair appointment, and major wirehouses opening client access to crypto exchange-traded funds.
