In light of the recent significant downturn in both Bitcoin and altcoin markets, Matt Hougan, Chief Investment Officer at Bitwise, shared some insightful observations about the current situation.
Hougan mentioned that he had discussions with various financial advisors throughout the week and noted a prevailing sense of optimism. He indicated that those advisors who have yet to invest view this market dip as a prime opportunity, while earlier investors are inclined to maintain their holdings.
According to Hougan, this market correction highlights a crucial point: ETF investors do not dictate market movements. He emphasized that “crypto-origin” investors remain the primary driving force behind cryptocurrency markets. While it has been widely believed over the past year that ETF investors were key marginal buyers, he contended that true influence comes from dedicated “HODL” investors. Furthermore, Hougan pointed out that holding a pro-Bitcoin stance still carries reputational risks for professionals in traditional finance (TradFi), suggesting those who have invested thus far possess strong conviction.
The price of Bitcoin took another hit today during morning trading sessions, dropping to approximately $67,000—one of its lowest points since October 2024. This decline underscores once again how vulnerable crypto assets can be amid waning global risk appetite.
You might remember Bitcoin reaching an all-time high exceeding $125,000 late last year; however, it has now lost nearly half its value over just four months. The rush away from risky investments—especially tech stocks and cryptocurrencies—has intensified selling pressure across these sectors. The disparity between Bitcoin’s performance since its peak in October and gold’s trajectory has become markedly pronounced; since February 2025 alone, Bitcoin has seen a depreciation of around 32%, whereas gold prices have surged by 68%. This shift towards safer assets is further amplifying stress within the crypto landscape.
Citi analysts recently informed clients through a note indicating substantial declines in inflows into Bitcoin ETFs coinciding with falling prices. They observed that ETF investments—which significantly contributed to last year’s surge in Bitcoin values—have lost their momentum lately.
Additionally, Citi estimates suggest that US spot Bitcoin ETF investors currently face an average acquisition cost near $81,600. With current prices dipping below this threshold indicates many ETF holders are now experiencing losses on their investments.
*This content does not constitute investment advice.