Bitwise Chief Investment Officer (CIO) Matt Hougan has warned investors that the current market turmoil is creating extreme volatility for Bitcoin and other digital assets. However, he remains optimistic about a recovery by the end of the year.
In his latest note to investors, Hougan pointed to key challenges, including the upcoming US presidential election and debates surrounding Federal Reserve interest rate cuts , as key factors influencing the current market downturn.
“Markets hate uncertainty, and there's a lot of uncertainty right now.”
He further emphasized that the lack of clarity on monetary policy and leadership in the United States caused Bitcoin to drop 7% in the first week of September, further exacerbating an already historically Capital trend this month.
Bitcoin’s September struggles are not new, Hougan said, with the digital currency down an Medium of 4.5% in September since 2010.
Bitcoin has suffered losses on nine of the last 13 Septembers, with 2011 being the worst year with a 41.2% drop. Hougan acknowledged that the trend has continued, with this year seeing significant losses.
“The September Effect is real, and Bitcoin has suffered from it many times.”
Hougan pointed to a number of possible causes for the phenomenon, including a broad-based decline in risk assets, with the Nasdaq-100 index down nearly 6% this month.
Additionally, he noted that enforcement actions by the U.S. Securities and Exchange Commission (SEC) typically increase in September, adding further pressure to the cryptocurrency market . Recent events, including settlements and lawsuits against companies like Galois Capital and OpenSea , have added to the volatility.
Despite the current difficulties, Hougan remains confident that Bitcoin and other digital assets can recover strongly in the final months of the year.
History shows that October and November are typically the best months for Bitcoin investors, with October even being dubbed “Uptober” due to its Medium gain of 30%. Hougan believes that as the uncertainty surrounding the US election and Federal Reserve policy eases, the market will gradually find stability.
“I think the market will see a strong recovery as the uncertainty fades in October and November.”
Hougan also pointed out that, despite the recent slight decline in Capital into Bitcoin and Ethereum ETFs, the growing adoption of Bitcoin ETFs by investment advisors is happening at a record pace, indicating long-term confidence in the asset class.
Join Telegram: https://t.me/tapchibitcoinvn
Follow Twitter (X): https://twitter.com/tapchibtc_io
Follow Tiktok: https://www.tiktok.com/@tapchibitcoin
Mr. Teacher
According to CryptoSlate
