Bitwise: The 4-Year Crypto Cycle Is Already Dead
Bitwise CEO Hunter Horsley presented five observations that, at first glance, appear to be separate topics, but in reality build toward one larger thesis: institutional capital has not simply entered the crypto market - it has changed the way the market functions.
Summary
- The 4-year crypto cycle is over, according to Bitwise.
- 2025 became the first down year after a halving.
- Spot ETFs now hold 6.4% of BTC supply.
- STRC is entering a $145 trillion market.
- Stablecoins surpassed $300 billion.
Five observations leading to the same thesis
According to Horsley, the five themes he discussed during the crypto conference Consensus 2026 in Miami actually describe the same transformation viewed from different angles.
In his view, the four-year cycle is losing relevance because institutional capital is gradually replacing retail investor momentum as the market’s primary driver. STRC structures are beginning to spread because institutional investors are now seeking yield generated from Bitcoin-backed collateral. BlackRock is not becoming a threat to companies like Bitwise, but rather the institution legitimizing the entire sector for more conservative pools of capital.
Horsley believes even the topic of BTC payments is changing because the market has already accepted Bitcoin as a store of value.
The stablecoin market is also growing thanks to institutional infrastructure and large technology companies beginning to build real payment models on crypto rails.
Taken together, these developments no longer resemble a new cycle, but rather a structural shift already changing market behavior, product development, and investor psychology.
What the “end” of the four-year cycle means
“The four-year cycle is dead,” Horsley said. “The four-year cycle assumed three years of a bull market followed by one down year. Last year was red, so the cycle is over.”
2025 became the first post-halving year in Bitcoin’s history to end negative – approximately 6% below where it started the year – after BTC reached a peak above $126,000 in October 2025 before later correcting by 45%.
Bitcoin price chart
According to analysis from Fidelity Digital Assets, realized volatility recorded 17 new all-time lows in January 2026 alone — behavior that looks very different from the explosive cycles seen in 2017 and 2021.
Horsley does not frame this as inherently positive news. Rather, he argues the crypto market is “paying” for institutional legitimacy by giving up its old behavioral patterns.
Spot Bitcoin ETFs now hold 1.3 million BTC, or 6.4% of circulating supply, according to Fidelity data. Meanwhile, 49 publicly traded companies each hold more than 1,000 BTC, with their combined reserves exceeding 1 million BTC.
Capital of that scale does not move in and out based on four-year patterns. It moves according to macroeconomic cycles, investment mandates, and corporate risk committee decisions. The halving still reduces supply, but it no longer automatically determines when institutional capital will begin moving.
That is why Grayscale also dismissed the old cyclical model as outdated in its forecasts for 2026.
There is, however, an opposing view. Canary Capital continues defending the thesis that the four-year cycle has not completely disappeared and that miner economics still exert structural influence over the market. According to this logic, the cycle may not be disappearing, but simply changing shape and timing.
STRC and the market Bitcoin previously could not serve
Regarding Strategy’s STRC instrument, Horsley described it as “irresistible” and predicted that Bitcoin-backed collateral structures would begin spreading throughout the industry over the next 12 months.
The comparison he used was unusual: Snapchat and disappearing photos. According to him, the idea appears simple on the surface, but actually solves a real problem the market failed to recognize for years.
“The idea behind STRC had been sitting in front of the market for years before Saylor turned it into a real product,” Horsley explained.
The more important takeaway concerns market size. The traditional bond and debt market is estimated at roughly $145 trillion.
STRC is one of the first structures enabling yield generation from Bitcoin collateral without requiring investors to directly hold BTC or speculate on its price.
If this model spreads, Bitcoin’s role could gradually expand beyond being merely a store of value and speculative asset, evolving into a collateral layer for a new class of financial products.
Why BlackRock actually helped Bitwise
Bitwise managed less than $1 billion in assets in 2021. By August 2025, the company managed $15 billion across more than 40 products with a team of over 140 investment and technology specialists.
Almost all of this growth occurred alongside BlackRock’s entry into crypto.
“BlackRock is the best thing that ever happened to Bitwise,” Horsley said.
According to him, Bitwise’s greatest obstacle was never competition among asset managers, but rather institutional hesitation and the absence of regulatory and reputational precedent.
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Before BlackRock, many pension funds and institutions simply had no internal justification for purchasing crypto products. The launch of the iShares Bitcoin Trust ETF changed that.
Horsley argues BlackRock is not “taking” Bitwise’s market. Instead, it is creating the market in which Bitwise can grow.
He describes the situation as a specialist versus a universal player, but the real effect is different: BlackRock absorbs the reputational risk of being first, while specialized firms like Bitwise inherit the institutional access unlocked by that decision.
Bitcoin payments and stablecoins
Horsley believes the crypto sector spent the last decade primarily focused on proving that Bitcoin has value.
In his view, that debate is now over. The market already has hundreds of millions of holders and an increasingly broad institutional consensus.
“We will actually enter this phase sooner than many expect,” he said regarding Bitcoin payments.
At the same time, the stablecoin sector continues growing rapidly. Total supply has already surpassed $300 billion, according to data from RWA.xyz.
What will prove whether this transformation is real
According to Horsley’s logic, the next major test will be whether Bitcoin-based payment infrastructure can reach at least 10 million active users over the next two years.
The alternative scenario is that stablecoin infrastructure gradually captures almost the entire crypto payments sector before Bitcoin-based solutions manage to achieve similar scale.
That would mean crypto payments truly returned – but not necessarily on Bitcoin itself.
The information presented in this article is intended for informational purposes only and should not be interpreted as financial, investment, or trading advice. Coinspress.com does not promote or advocate for any particular investment strategy, asset, or cryptocurrency project. Cryptocurrency markets are highly volatile and unpredictable – always perform your own research and seek guidance from a qualified financial professional before making any investment decisions.
Kosta Gushterov
Reporter at CoinsPress
Kosta has reported on cryptocurrency markets and blockchain infrastructure since 2020, bringing over six years of hands-on experience in the crypto industry built through daily tracking of markets, trends, and emerging blockchain developments. Specializing in Bitcoin on-chain analysis, institutional ETF flows, and digital asset price action, his work has been cited by other news agencies and consistently covers market developments with a focus on data-driven reporting across Bitcoin, Ethereum, Solana, and XRP. Over the years, Kosta has contributed to multiple crypto media outlets in different regions, authoring over 6,000 articles across the sector. His reporting spans cryptocurrency markets and the broader fintech industry, tracking not only price action but also the technological and regulatory forces shaping the ecosystem. To support his analysis, Kosta actively leverages on-chain data and metrics from leading platforms such as Santiment, Glassnode, and CryptoQuant, enabling deeper, evidence-based market insights. He believes in the power of transparency and the data that underpins the blockchain ecosystem. His academic background in Marketing Management from Denmark further complements his analytical approach, adding a strong understanding of communication strategy and content positioning to his work.
