I remember back in 2022 where we had the fallout from FTX and the collapse of 3 Arrows Capital and basically the Bitcoin market was in complete disarray and we tended to go between $16-$20k in price action.
Then we had 3 of the 4 largest bank failures in US History happen within the next 60 days with Silicon Valley Bank, Signature Bank and First Republic Bank all collapsing in 2023 - although they were servicing crypto businesses as part of their portfolios and there is still a lot of speculation that they were shut down because of those ties even though there’s a lot of back and forth about whether or not they were insolvent but instead were a weapon wielded to crush the crypto industry and they nearly destroyed the US banking system in one of the dumbest moves of all time.
And what do you think Bitcoin price did during that time?
You would have seen a 40% rise in price over that time.
I have never once, ever seen a person say that a banking collapse would help break Bitcoin out of a bear market, yet there is proof right there.
Then we had the Bitcoin ETF’s get a surprise approval in the United States and that was also a huge catalyst here.
In fact, this was the first moment I realized that Bitcoin was going to $1 Million.
But had you bought then you would have seen an over 50% gain in your investment.
So why mention these two particular moments?
Well… people are trying to find the next big catalyst for Bitcoin’s price and I am going to discuss a couple of the potentials out there but here’s the deal.
We have no idea what these catalysts could be.
It could be something totally expected and it could be something completely unexpected, which it probably will be or it could be we go back up out of sheer boredom.
Hougan’s Exhaustion Theory: Why Bears Die Slowly, Then All at Once
Matt Hougan is the CIO of Bitwise and probably one of my favorite people to follow because he’s not a YouTuber with laser eyes.
He’s a suit who looks at numbers and charts and makes assessments like a sane and rational person.
And last week, he said something that should be very thoughtfully considered anytime you’re feeling frustrated by the markets.
“Crypto bear markets tend to end in exhaustion, not excitement.”
Which is not to say that the bottom is in but he is saying something more nuanced and more important for our mental fortitude.
He’s saying bear markets don’t end when some catalyst rockets the price higher.
They end when sellers run out of energy.
When everyone who’s going to sell... has already sold and they’re just done with this game.
And this is what Hougan is saying where he told investors “We have been in a crypto winter since January 2025.” That’s 13 months.
He noted that past bear markets typically lasted about 13 months.
His exact words: “Chances are, we’re closer to the end than the beginning.”
Now the crypto winter seems much more recent based on USD prices but Hougan is looking more at macro setups and store of value subjects to base his thesis on and he may be on to something.
Open interest on derivatives exchanges has dropped over 40% from October’s peak.
The leverage is gone. Liquidated. Washed out into the ocean, some never to be seen again.
CoinGlass data shows $2 billion in positions wiped out in a single week.
C'est la vie.
And yet... Bitcoin is still here trading around $69,000.
Down from $126,000. But up 920% from where it was five years ago.
The network is running. The blocks are producing. The protocol cares not for our silly frivolous dollars and cents.
Here’s what Hougan nailed: “With crypto market sentiment near historic lows and around the levels where crypto bottomed in 2018 and 2022 it feels like much of the bad news is already priced in.”
That’s time-based capitulation. It’s not a single event. It’s a process. The bears don’t get killed by a bull. The bears hibernate and the bulls run wild and free.
Japan Just Dropped a Bomb (And Nobody’s Paying Attention)
While American crypto Twitter was doom-scrolling through red candles last week, something massive happened 6,000 miles away.
Japan’s Prime Minister Sanae Takaichi won the largest electoral landslide in Japan’s post-war history on February 8th.
Her party is projected to take between 274 and 326 of the 465 seats in the lower house.
That’s not a win. That’s a mandate.
Why should you care?
Because Japan currently taxes crypto gains at up to 55%.
That’s driven investors, developers, and entire startups out of the country or into Metaplanet (Japan’s version of Strategy) to express their interest in Bitcoin.
And Takaichi’s coalition is now positioned to slash that rate to around 20%, allow loss carryforwards for three years, and reclassify digital assets as financial products.
The BTC/JPY trading pair jumped nearly 5% on the news and the Nikkei 225 hit record highs above 57,000.
Japan isn’t some minor market in fact, the country’s crypto sector generated roughly $368 million in revenue in 2025.
And with a crypto-friendly supermajority now in power, projections suggest the sector could grow to $1.17 billion by 2033.
Sota Watanabe, founder of Astar Network, put it bluntly: “Nobody, no party is questioning crypto and how it shapes the world in the coming years. Regardless of outcome, the new bill to incorporate crypto will be passed.”
The world’s third-largest economy just handed its leader the votes to make crypto tax reform happen. U.S. Treasury Secretary Scott Bessent congratulated Takaichi on X, calling the U.S.-Japan alliance one of “unlimited potential.”
When sovereign nations compete to attract Bitcoin capital by lowering taxes and clarifying regulations... that’s not a bear market narrative. That’s the infrastructure for seven figures being built in real time.
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The Whales Must Feast…
You want to know what happened while Bitcoin was crashing to $60,000 on February 6th?
The whales went shopping.
CryptoQuant data shows accumulator addresses acquired more than 66,900 BTC on February 6th alone.
That’s roughly $4.6 billion worth of Bitcoin at crash prices in one day.
While retail investors were liquidating in panic and CNBC was running “Is it over?” segments.
On February 8th, on-chain data from Arkham showed a whale moving 1,546 BTC... that’s $106.7 million... from Binance to cold storage.
That’s not a trader taking a position that’s someone who bought the dip and locked it away.
The pattern here is rhyming.
Every major Bitcoin bottom in history shows the same thing: retail sells, whales accumulate, time passes, price explodes.
And it’s not just anonymous wallets.
Strategy (formerly MicroStrategy) bought another 1,142 BTC between February 2nd and February 8th while posting a $12.4 billion quarterly loss on paper.
Michael Saylor responded by tweeting “More Orange” and a chart of their latest purchase.
The man is sitting on 713,502 Bitcoin with unrealized losses and his response was to buy more.
You can call that reckless. You can call that conviction. But when the largest corporate Bitcoin holder in history uses a 54% drawdown as a buying opportunity... maybe we need less fear and more conviction ourselves.
The bear is getting tired. The question is... will you be positioned when it finally lies down?
The ride continues tomorrow.
P.S. If you haven’t ordered “The Million Dollar Bitcoin” yet, do it now. This newsletter gives you headlines. The book gives you the complete thesis. Available on Amazon right now. Start reading today when it can still change your tomorrow, not “someday.”