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What happened?
Matt Hougan, the Chief Investment Officer of Bitwise, has suggested that the long-standing four-year crypto cycle, influenced by Bitcoin’s halving events, is losing its significance. He believes new factors like growing capital inflows into crypto ETFs and improved regulation are now driving more sustained growth in the crypto market. Hougan anticipates a longer, steady boom rather than the traditional cycles of sharp booms and busts.
Who does this affect?
This change affects a wide range of stakeholders in the crypto space, including retail investors, institutional players, and financial regulators. With institutional adoption on the rise, pensions, endowments, and national account platforms are beginning to include crypto in their portfolios. Additionally, as regulations stabilize, entities such as Wall Street banks might start developing extensive financial products centered around cryptocurrencies.
Why does this matter?
The shift away from the traditional crypto cycles could have significant market impacts, as it implies a more stable and potentially lucrative investment landscape. The growing involvement of institutional investors and regulatory clarity may lead to increased market confidence and attract more capital. This could result in cryptocurrencies becoming a more integral part of mainstream financial systems and driving long-term value growth.
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