Trump's Order Sparks $1.9B Crypto Surge, Reshaping Bitcoin's Cycle

Bitcoin's (BTC) market cycle is poised for a significant shift, according to Matt Hougan, Chief Investment Officer at Bitwise. Trump's recent executive order, which aims to create a "national digital asset stockpile," has sparked a $1.9 billion surge in crypto investments and is expected to reshape Bitcoin's traditional four-year cycle. Hougan predicts that the cycle will become less intense, with shorter corrections, due to rising institutional adoption.

Hougan highlighted the significance of Trump's order and the SEC's recent pro-crypto stance as key factors driving Bitcoin's mainstream growth. On January 23, Trump signed the order, leading to a massive influx of investments into the crypto market. This decision, Hougan argues, has paved the way for major Wall Street firms and institutional investors to enter the market aggressively.

Bitcoin's latest cycle began in March 2023, when Grayscale won a critical legal battle against the SEC regarding a Bitcoin ETF. This victory set the stage for the launch of Bitcoin ETFs in January 2024, attracting billions in investments. However, Hougan believes Trump's executive order will bring an even greater transformation.

In his weekly memo, Hougan discussed how mainstream adoption is progressing beyond expectations. He envisions a scenario where banks will soon custody crypto assets alongside traditional investments, stablecoins will integrate into global payments, and major institutions will secure significant crypto holdings. These changes, he claims, could lead to the inflow of trillions of dollars into the crypto market.

Bitcoin historically follows a four-year cycle driven by halving events, which reduce the mining rewards and impact price movements. The pattern typically consists of an accumulation phase, a bull run, and a subsequent downturn. Past declines occurred in 2014, 2018, and 2022, suggesting another drop in 2026 if history repeats itself. However, Hougan remains optimistic, citing the market's maturity and a broader range of investors as reasons for a more resilient future.

Looking ahead, Hougan predicts that 2025 will be a landmark year for Bitcoin, with prices potentially surpassing $200,000. He attributes this growth to continued ETF inflows and increased adoption by corporations and governments. However, he acknowledges that this forecast might be conservative, as the crypto industry is