Bitwise executive: “Bitcoin (BTC) hasn’t bottomed yet… patience required”

JH Kim

Summary

Matt Hougan, Bitwise’s chief investment officer, said Bitcoin (BTC) is likely not yet in the process of forming a bottom.
He said that even after Bitcoin’s sharp drop, more pain and major volatility could lie ahead, stressing that investors need patience.
He added that as institutional investors play a bigger role, the drawdown could ease from a historical average of 80% to around 50%–60%.

Matt Hougan, chief investment officer (CIO) at Bitwise, a crypto asset manager, said Bitcoin (BTC) is likely not yet in the process of forming a bottom.

According to crypto-focused outlet DL News on the 20th (local time), he said on a podcast, “It was shocking that on Feb. 5 Bitcoin plunged from $72,000 to $60,000, but that wasn’t the bottom,” adding, “There could be more pain ahead. I wouldn’t be surprised to see another major bout of volatility.”

He went on to stress that “investors need to be patient.”

Hougan explained that Bitcoin has traditionally repeated boom-and-bust cycles on a four-year cadence.

He added, however, that the growing participation of institutional investors is introducing a different variable than in the past.

“If institutional money comes in, the drawdown—previously about 80% on average—could ease to around 50%–60%,” he said, adding, “Institutions and retail investors move differently, so when one side sells, the other may step in to buy.”