TL;DR
- Bitwise CIO Matt Hougan projects Bitcoin could compound 28% annually for 10 years, versus typical 5% equity and 4% bond expectations.
- He says the market looks like a classic 2018 or 2022-style bear phase, reinforced by investor belief in four-year cycles and heavy retail drawdowns.
- Hougan cites institutional BTC and ETH accumulation, DeFi, stablecoins, and tokenization, expects a U-shaped 2026 bottom and 2027 alignment, while ETFs broaden slowly over time.
Matt Hougan, CIO at Bitwise, argues Bitcoin could deliver a 28% compound annual return over the next decade, far above the roughly 5% he contrasts for equities and about 4% for bonds. The punchline is Bitcoin as a long-horizon portfolio outlier, even in a fragile tape. He framed the forecast as a potential asset-allocation disruptor, while acknowledging the current mood is still bruised. At press time, Bitcoin traded at $68,122, up 1.5% over 24 hours, a reminder that sentiment can shift quickly. He expects fundamentals to strengthen first, with valuations catching up in a phase.
https://twitter.com/BitwiseInvest/status/2024492767183868401
Why the long-term call survives a rough cycle
Hougan’s optimism is paired with a sober read on where the cycle sits. He calls the current environment a classic bear market, echoing the 2018 and 2022 crypto winters. Speaking about market structure, he said crypto still appears to follow a four-year cycle, even if prior catalysts like halving events or large industry failures may matter less than before. In his view, cycles persist because investors expect them, and positioning around the timeline reinforces the pattern. The result is self-fulfilling behavior that can extend drawdowns. That framing sets expectations for patience, not instant V-shaped recoveries.
He argues the cycle pressure is visible in who is holding and who is hurting. Institutions kept accumulating Bitcoin and Ethereum through late 2025 while many retail participants absorbed steep losses. Hougan noted numerous altcoins are down 70% or more from prior highs, and extreme fear readings suggest the downturn began earlier than many expected. Yet he maintains that weaker prices do not automatically mean weaker fundamentals. Instead, he points to steady building and usage as the market reprices risk, a dynamic that can look ugly before it clears. For allocators, that gap is actionable.
On fundamentals, Hougan points to expanding DeFi, stablecoins, and tokenized real-world assets, plus major digital-asset efforts at BlackRock and tokenization strategies at Apollo. His base case is a slow U-shaped recovery: 2026 as a bottoming year, with 2027 bringing prices closer to strengthening fundamentals. He expects ETFs to widen gradually beyond Bitcoin and Ethereum, but with institutional capital concentrated in leading assets or index-style products. He also said forced selling by corporate holders like MicroStrategy would likely require a prolonged 80% decline. Regulatory clarity may still take years. He frames crypto as a 10-to-15-year transformation.
