Bitcoin’s Decline Not Institutions’ Fault, Says Matt Hougan: “Just a Typical Cycle”

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Various conspiracy theories are emerging surrounding the recent decline in Bitcoin (BTC) prices. However, Matt Hougan, Chief Investment Officer (CIO) at asset management firm Bitwise, diagnosed the situation as a typical market cycle rather than artificial manipulation.

According to crypto media outlet CoinGape on February 27 (local time), Hougan stated via X (formerly Twitter) that Bitcoin’s recent downturn reflects the natural flow of the market. He explained that the fundamental reason behind the price drop was that many investors holding long positions sold off their holdings. “Investors reduced their exposure by selling spot holdings, closing leveraged positions, and selling call options,” he said, analyzing that “a combination of factors was at play, including the four-year cycle theory, fears over quantum computing, and efforts to secure funding for artificial intelligence startups.”

Although suspicions persist in the market that certain firms led the downturn, Bitwise dismissed those claims. In parts of the crypto community, there have been allegations that major players such as Binance and Jane Street orchestrated organized sell-offs, including the so-called “10 a.m. dump” theory claiming that Jane Street deliberately pushes prices down every morning at 10 a.m. Ark Invest CEO Cathie Wood had also previously mentioned that a software error on Binance on October 10, 2025, triggered $28 billion in leveraged liquidations, negatively impacting the market.

Hougan expressed strong skepticism about these conspiracy theories, which tend to change targets weekly. “First it was Binance, then Wintermute, then an unidentified offshore hedge fund, then paper Bitcoin, and today it’s Jane Street—but next week, another target will emerge,” he cautioned against unfounded speculation. Despite some experts, including Eric Balchunas, raising the possibility of pressure from Jane Street, Hougan emphasized focusing on fundamentals and the movement of investor capital.

Amid the debate, market experts are also warning of the possibility of further declines in Bitcoin’s price. Prominent analyst Willy Woo presented a bearish scenario in which Bitcoin could retreat to $45,000, urging investors to remain cautious. With liquidity across the digital asset market contracting and a clear trend of capital shifting from cryptocurrencies to artificial intelligence-related companies, short-term downward pressure is expected to persist for the time being.

Ultimately, the current wave of Bitcoin selling is interpreted as a typical market correction driven by changes in asset allocation strategies and technical factors, rather than intervention by artificial forces. Bitwise’s core argument is that the sell-off reflects a natural rotation of capital, as long-term holders realize profits on spot Bitcoin and turn their attention to the AI industry as a new growth engine. Experts advise investors to focus on market supply and demand dynamics and broader capital flows rather than being swayed by unfounded conspiracy theories.

Disclaimer: This article is provided for investment reference purposes only, and we are not responsible for any investment losses incurred based on it. The content should be interpreted solely for informational purposes.