Why Bitcoin's Next Market Cycle May Look Very Different – BloFin CEO

Bitcoin is struggling around $80,000 as ETF demand swings and rising oil prices complicate the outlook for interest rates. Yet BloFin CEO Matt Hu believes the cryptocurrency’s future crashes could become less severe.

Speaking to BeInCrypto at TOKEN2049 in Singapore earlier this month, Hu explained how traditional investors are changing Bitcoin, what could drive its next rally, and why altcoins may be left behind.

The latest market turmoil is putting those arguments to the test.

Are Bitcoin’s Boom-and-Bust Cycles Becoming Less Severe?

“The biggest change is Bitcoin’s ownership base.”

According to Hu, ETFs and corporate treasuries have brought in investors with longer investment horizons, potentially reducing panic selling during downturns.

“Despite headlines about daily ETF inflows and outflows, the total amount of Bitcoin held by these funds, measured in BTC, remained broadly stable through the bear market,” the BloFin CEO explained.

1/2👀 This week in Whale's Insight:🐋 BTC holds $80K as whales flip to buyingg: 1K to 10K BTC holders’ 60d net flow swung from −62.6K to +5.23K BTC📉 Fresh demand still missing: BTC ETFs saw $635M in outflows on Oct 22, the largest since Jun 25🎯 The two largest short… pic.twitter.com/QaaT2od5Qr

— BloFin Research (@BloFin_Academy) October 23, 2026

BloFin’s Research estimated that US spot ETFs held roughly 1.3 million BTC, broadly unchanged since January.

The research also found that Bitcoin’s latest bear-market decline reached 53%, compared with crashes of approximately 77%–85% in previous cycles. However, that comparison assumes June remains the market bottom.

The theory now faces a difficult test.

Bitcoin slipped below $80,000 over the weekend. US spot Bitcoin ETFs recorded $635.6 million in net outflows on October 22, following three sessions that attracted more than $1 billion.

Meanwhile, Glassnode estimates that ETF investors and Bitcoin treasury companies have average acquisition costs near $81,500 and $80,200, respectively.

Sustained weakness below those levels would put both groups at a loss on average, potentially testing their willingness to hold.

Hu identified specific conditions that would undermine BloFin’s outlook.

“A sustained decline in ETF Bitcoin holdings, widespread forced selling by Bitcoin treasury companies, and a shrinking long-term holder base, as measured by on-chain metrics, would invalidate our current view.”

For investors, this distinction matters. Daily ETF outflows can move prices, but a sustained reduction in Bitcoin holdings would offer stronger evidence that long-term capital is leaving.

Glassnode identifies 85,000–87,500 as an important resistance area.Analysts warn that losing the 80,000–82,000 support zone could expose Bitcoin to a deeper decline toward 73,000–75,000.

The Bitcoin ETF investor base proved resilient through the downturn. Headlines about large daily inflows and outflows can obscure the broader picture: US spot Bitcoin ETFs held around 1.3 million BTC on October 20, broadly unchanged from the end of January. Even as Bitcoin… pic.twitter.com/2mcrGu8dDI

— BloFin Research (@BloFin_Academy) October 21, 2026

What Could Drive Bitcoin’s Next Sustained Rally?

Government debt could eventually become a powerful catalyst for Bitcoin, according to Hu. However, current financial conditions are working against that possibility.

“Higher bond yields currently make bonds attractive and draw capital away from Bitcoin.”

The US 10-year Treasury yield ended October 23 near 5%, while Brent crude climbed above $116 a barrel.

Higher energy costs threaten to keep inflation elevated, limiting the Federal Reserve’s room to ease monetary policy.

Even inflation-protected 10-year US government bonds were yielding around 2.6%. That makes Bitcoin, which generates no income, less attractive to investors seeking predictable returns.

However, Hu believes rising government debt could eventually change that relationship.

“However, as government borrowing costs continue to climb, fiscal sustainability may eventually take priority in policy decisions, leading to financial repression.”

In simple terms, governments facing growing debt burdens could pressure central banks to keep borrowing costs artificially low.

That might involve maintaining interest rates below inflation or purchasing government bonds to suppress yields.

“As financial repression increases, bondholders may still receive high nominal yield, but inflation erodes their real return,” Hu explained.

Bitcoin could benefit if investors increasingly seek assets with limited supply to preserve purchasing power.

Yet that remains a longer-term scenario.

For now, traders face the Federal Reserve’s October 28 policy decision. Falling inflation-adjusted bond yields and stronger institutional buying would provide more immediate evidence of improving conditions.

Coinbase estimates that ETFs have attracted approximately $6.4 billion in net Bitcoin investment since August, compared with $1.5 billion purchased by corporate treasuries.

Whether those inflows continue could determine how sustainable the next recovery becomes.

1/3 | Crypto & Cross-Market Brief — October 2026The market rally is facing a macro stress test.Renewed Fed tightening expectations, rising Treasury yields, and geopolitical uncertainty are weighing on risk appetite.But beneath the correction, market fundamentals tell a more… pic.twitter.com/eLPr0yOAw4

— BloFin Research (@BloFin_Academy) October 16, 2026

Will the Next Bitcoin Rally Lift Altcoins?

Hu is less convinced that the traditional altcoin season will return.

“The altcoin market faces a structural change.”

In earlier cycles, Bitcoin rallies often encouraged investors to move into smaller, riskier cryptocurrencies.

Now, tokenized stocks and other real-world assets offer alternatives that could compete for the same speculative capital.

“Companies with strong earnings and cash flow may attract capital that previously flowed into low-quality altcoins,” Hu said.

The current market already shows how uneven crypto investment has become.

CoinGecko’s third-quarter report showed spot trading volumes falling 14.2%, while perpetual futures open interest increased 40.6%.

The figures suggest leverage has been growing faster than underlying trading activity.

Hu believes future investment opportunities will increasingly favor tokens supported by genuine economic activity and mechanisms that return value to holders.

“The traditional altseason pattern may fail if liquidity remains fragmented and tokenized assets offer investors better choice.”

For Bitcoin, the immediate question is whether institutional holders can withstand another selloff. 

For the wider crypto market, even a convincing Bitcoin recovery may no longer guarantee the broad rallies investors remember from previous cycles.