Amid the recent volatility in the cryptocurrency market, Matt Hougan, Chief Investment Officer at Bitwise Asset Management, has provided an in-depth analytical framework for Bitcoin’s (BTC) future trajectory. He believes the market is currently positioned at a critical technical and psychological juncture, noting that the $84,000 level—also the interim low during the March pullback—has become an important support line closely watched by many investors. This price level is not only a technical point on the chart but also carries the market’s collective memory and emotional anchoring. If it holds, it could deliver meaningful support to market confidence.
However, Hougan also warns investors not to overlook the risk of a deeper correction. He points out that if market sentiment continues to weaken—erasing all the gains made since last October, when Bitcoin surged to an all-time high of $126,000—the price may fall further, returning to the core trading range of around $70,000 observed before former U.S. President Donald Trump’s election. This implies that Bitcoin may face a potential 20% drawdown, posing a serious challenge to short-term speculators and highly leveraged positions.
Despite the possibility of a decline toward the lower-to-mid $70,000 range, Hougan emphasizes that the market is “closer to a cyclical bottom than the beginning of a new downtrend.” He observes a clear split in market sentiment: on one hand, short-term panic is spreading; on the other, long-term investor confidence is steadily building.
This divergence manifests in two key areas. In terms of short-term negative factors, liquidity across several major global economies is tightening, and large-scale forced liquidations linked to decentralized autonomous trading (DAT) have added significant selling pressure, contributing to a technical correction. Meanwhile, structural long-term capital is quietly positioning itself. Hougan specifically highlights that top institutional investors with strong signaling importance—such as the Harvard University endowment and the Abu Dhabi Investment Authority—have begun to take “exploratory” positions in the current price range. These institutions typically adopt a long-term investment approach; they do not attempt to time the exact bottom but focus instead on establishing strategic allocations within zones of relative value.
The coexistence of short-term fear and long-term confidence reveals a far more complex market landscape. Although price fluctuations remain sharp, Bitcoin’s underlying value proposition is gaining recognition among a broader base of institutional investors. After necessary price discovery and leverage-cleansing processes, the market may be laying the groundwork for the next phase of healthy growth. Hougan’s analysis ultimately points to a central conclusion: the market is currently at a crossroads between a short-term correction and a long-term trend, and investors must pay close attention both to the defensive strength of key technical support levels and to the signaling effects of long-term capital inflows.
