Bitwise Says Crypto Market Likely Formed a Bottom in Q4 2025

The crypto market may have reached a cyclical bottom in the fourth quarter of 2025, according to a new report from Bitwise.

The firm argues that recent price weakness has occurred despite a clear improvement in underlying fundamentals — a divergence that historically tends to appear near market bottoms.

Fundamentals strengthening beneath the surface

In its latest analysis, Bitwise highlights several indicators pointing to improving internal health across the crypto ecosystem:

• Record levels of activity on the Ethereum network and layer-2 solutions
• Rising revenues among crypto-native companies
• Continued growth in the total market capitalisation of stablecoins
• Strong expansion in decentralised finance adoption

Despite these developments, asset prices have remained under pressure — a pattern that Bitwise describes as typical during late-stage bearish phases, when sentiment remains pessimistic even as fundamentals begin to turn.

A familiar bottoming pattern

Historically, market bottoms are rarely marked by improving price action. Instead, they are often characterised by frustration, disbelief, and a lack of participation, even as structural metrics quietly improve.

Bitwise notes that this disconnect between price and fundamentals has preceded previous crypto market recoveries, as selling pressure fades and longer-term capital begins to re-enter the market.

Broader market views align

Similar views have been expressed by several market strategists, who suggest that the current phase may represent consolidation rather than the start of a new downturn.

While timing remains uncertain, such perspectives reinforce the idea that the crypto market may be transitioning from capitulation toward stabilisation.

What to watch next

According to Bitwise, confirmation of a sustained recovery would likely depend on:

• Stabilisation and expansion of on-chain activity
• Continued growth in stablecoin liquidity
• Improving sentiment alongside higher trading volumes

The message from Bitwise is not that a new bull market has already begun, but that the structural conditions typically associated with market lows appear to be in place.

In crypto markets, bottoms are often recognised only in hindsight. According to Bitwise, the current signals are consistent with that historical pattern.