Q4 2025 May Have Marked the End of Crypto Bear Market: Bitwise
The fourth quarter of 2025 could have quietly signaled the finish of the crypto bear market, in line with a brand new report from digital asset supervisor Bitwise, at the same time as costs struggled to replicate enhancing fundamentals.
Key Takeaways:
- Bitwise says Q4 2025 confirmed strengthening crypto fundamentals regardless of continued value weak point.
- Hougan sees parallels with early 2023, when muted costs preceded a significant market rally.
- Analysts stay break up on 2026, at the same time as on-chain exercise and crypto revenues hit new highs.
In a report shared Wednesday, Bitwise chief funding officer Matt Hougan stated Q4 introduced a complicated image for traders.
Crypto costs weakened by a lot of the quarter, but on-chain information, person exercise, and income metrics throughout the sector continued to strengthen.
Bitwise’s Hougan Draws Parallels Between Today’s Market and Post-FTX 2023
Hougan in contrast the present setup to early 2023, when markets have been nonetheless reeling from the collapse of FTX.
At the time, crypto costs appeared directionless regardless of indicators of restoration underneath the floor. Bitcoin rebounded from lows close to $16,000 and finally surged to round $98,000 by the begin of 2025.
“At the time, we have been beginning to rebound post-FTX, and the information was topsy-turvy; some up, some down, some sideways,” Hougan stated. “In the two years that adopted, crypto costs soared.”
According to Hougan, the identical divergence between sentiment and fundamentals emerged once more in late 2025. While asset costs pulled again, key indicators throughout the crypto financial system moved sharply larger.
The outlook for 2026, nonetheless, stays some extent of debate amongst analysts.
Fundstrat head of analysis Tom Lee has warned that macro headwinds, together with commerce tariffs and political uncertainty, may weigh on markets for a lot of the 12 months earlier than a late rebound.
By distinction, VanEck expects the first quarter of 2026 to favor “risk-on” assets comparable to crypto, citing higher fiscal readability and indicators of stabilization in the U.S. financial system.
Hougan highlighted 4 developments from Q4 that he believes strengthen the case for a market backside.
Ethereum and layer-2 networks noticed transaction volumes climb to file ranges, suggesting rising real-world utilization.
At the identical time, revenues amongst crypto-focused corporations outpaced many conventional sectors in the inventory market.
Stablecoin Market Hits Record $300B as Transaction Volumes Surge
Stablecoins additionally performed a central function. Transaction volumes and property underneath administration surged all through 2025, with complete stablecoin market capitalization surpassing $300 billion in Q4, marking a brand new all-time high.
Decentralized finance adoption rounded out the checklist. Hougan pointed to Uniswap, noting that the decentralized alternate now persistently processes extra transaction quantity than Coinbase.
“That’s the form of divergence you get at the backside of bear markets, when sentiment is down however fundamentals are up,” he stated.
Bitwise added that a number of potential catalysts may push crypto markets larger in 2026, together with progress on the CLARITY Act, continued progress in stablecoins, a brand new Federal Reserve chair appointment, and main wirehouses opening consumer entry to crypto exchange-traded funds.
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