The current bitcoin bear market looks fundamentally different from previous cycles, according to asset manager Bitwise, which sees institutional adoption ramping up against a backdrop of AI hype, macroeconomic uncertainty and delays to U.S. crypto legislation.
Bitwise Senior Investment Strategist Juan Leon told The Block that the firm's institutional clients have mostly split into two camps.
Investors with established bitcoin allocations over the past two years are "treating the downturn as a gift" to rebalance and dollar-cost average, while other large pools of capital are waiting for greater regulatory clarity before committing.
"In 2022, clients asked whether crypto would survive," Leon said. "In 2026, they're asking about entry points and position sizing. That's a different conversation entirely."
It has made the current downturn bitcoin's "mildest structural bear market" on record, Leon argued, comparing the current 50% drawdown to the 78% swing during the 2022 bear market and the 84% drop in 2018.
