Bitwise sees Bitcoin bottom forming before autumn

• Bitwise Chief Investment Officer Matt Hougan said Bitcoin's recent weakness may represent a late-stage deleveraging process rather than weakening demand.
• Hougan argued volatility in Strategy's STRC preferred shares reflects excess leverage being removed from the market ahead of a potential recovery.
• He said indicators including valuation discounts, extreme fear and negative funding rates could signal a market bottom before a possible autumn rally.

Bitwise Chief Investment Officer Matt Hougan said the recent correction in Bitcoin (CRYPTO:BTC) appears to be a late-cycle deleveraging event that could precede a new bull market later this year rather than signalling a structural decline in demand.

Hougan pointed to volatility in Strategy Stretch preferred shares, saying the instrument reflects leverage built during the previous rally that is now being unwound as Bitcoin continues trading above US$60,000.

"As the market continues to sort things out, I'm convinced the bottom is closer than ever—and that we will enter a new bull market in the fall," said Hougan.

Hougan said STRC attracted yield-focused investors while helping finance Bitcoin exposure through Strategy's balance sheet, adding that the current adjustment reflects excess leverage being removed rather than a fundamental change in Bitcoin's long-term outlook.

He said a sustained recovery would depend on market conditions rather than price alone, citing a potential Strategy discount to net asset value, extremely low Crypto Fear and Greed Index readings and negative Bitcoin funding rates as indicators he would monitor, while Strategy shares were not materially affected following the comments.

Bitcoin recently recovered from lows near US$60,000 to trade around US$62,700, although Hougan said previous market cycles have also experienced temporary rebounds before deleveraging was fully completed.

Hougan said the removal of speculative excess could create conditions for a more durable recovery, while emphasising that his outlook reflects his market assessment rather than a guaranteed outcome.

At the time of reporting, Bitcoin price was $63,668.65.