Could President Donald Trump’s recent executive order on cryptocurrencies disrupt Bitcoin’s historical four-year cycle? According to Matt Hougan, Chief Investment Officer at Bitwise Asset Management, the answer is a resounding maybe.
In a note to clients on Wednesday, Hougan acknowledged the traditional pattern of three years of growth followed by a significant correction. “If we were following the classic four-year cycle, 2025 would be a great year for crypto,” he wrote, predicting Bitcoin could double to over $200,000 this year, fueled by ETF inflows and institutional adoption. He even suggested this prediction might be conservative.
However, Hougan also pointed to signs of potential overheating, including increased corporate borrowing to purchase Bitcoin, the rise of lending programs against Bitcoin holdings, and growth in derivatives and leveraged ETFs. While these factors typically reinforce the four-year cycle theory, Trump’s executive order introduces a significant new variable.
The executive order, which establishes a task force to explore a U.S. digital asset reserve, is “overwhelmingly bullish” for the crypto space, according to Hougan. He emphasized the order’s declaration of a “national priority” to expand the digital asset ecosystem and create a clear regulatory framework.
“The launch of ETFs was a significant catalyst, bringing hundreds of billions of dollars into crypto,” Hougan explained. “But the full mainstreaming envisioned by Trump’s executive order – with banks holding crypto, stablecoins integrated into payments, and major institutions taking positions – could bring trillions.”
Historically, Bitcoin has adhered to a four-year cycle, with corrections ranging from 58% to 74% following periods of growth. Hougan noted Bitcoin’s strong performance in 2023 and 2024, suggesting 2025 should follow suit. However, the question remains whether a 2026 downturn is inevitable.
Hougan traced the current “mainstream cycle” back to the 2022 crypto market crash and the subsequent Grayscale victory against the SEC in March 2023, which paved the way for spot Bitcoin ETFs. The launch of these ETFs in January 2024 attracted institutional investors, propelling Bitcoin from around $22,000 to over $100,000 within a year.
Timing is key, according to Hougan. While the executive order’s positive impact is undeniable, it will take time to fully materialize. He questioned whether a “crypto winter” is likely in 2026 if the order’s effects are not felt until then, particularly given bullish sentiment from figures like BlackRock CEO Larry Fink, who has predicted a $700,000 Bitcoin price.
Hougan believes the four-year cycle may not be completely eradicated yet, as increasing leverage during the bull market could lead to corrections. However, he anticipates shorter and shallower downturns compared to the past, reflecting the growing maturity of the crypto market.
“For now, it’s full steam ahead,” Hougan concluded. “The crypto train is leaving the station.”
