Bitcoin’s Future Comes Down To This One Question, Says Bitwise
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U.S. President Donald Trump formally established strategic bitcoin reserves last week, an action that has sparked celebrations and attention throughout the industry. At the heart of this debate is a central question: Will Bitcoin become a geopolitical, important global macro asset like gold, or will it remain a niche among liberals, Cypherpunk and speculators?
That’s the latest core gain of Bitwise Investor MemorandumWritten by Chief Investment Officer Matt Hougan. Titled “The Only Important Issues in Bitcoin”, dated March 10, 2025, the memorandum highlights how the long-term prospects of Bitcoin depend on whether the world (with governments that started in the United States) are sufficient to maintain strategic reserves of construction as an indispensable government.
A big problem with Bitcoin
In the memorandum, Howman highlighted the astonishing nature of the U.S. government decision, writing: “Fifteen years after the creation of Bitcoin (ten and a half years of ridicule and skepticism), people call it “pet rock” and “pet drugs” and “rat poison” – the U.S. government declared Bitcoin a “strategic” asset to “bitcoin.”
He thinks that Bitcoin’s recognition is Strategic reserve assets Marking a historic turn: “This is a historic milestone that will help push Bitcoin to an all-time high over time. Congratulations to everyone who believed in this possibility before cool.”
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However, the market did not welcome the announcement uniformly. While formal government endorsement seems to enhance the legitimacy of Bitcoin, it also disappoints some investors who are expected to immediately pour into new government purchases.
Shortly after the release news, the price of Bitcoin fell to 13% from its most recent high price of over $92,000, down to under $80,000 for the first time since November 2024. Hougan pointed out several factors: wider economic worries, the decline in the stock market, and what he is crucial to what he calls “misunderstanding” about the actual stage of government.
“Despite the historicity of the declaration, Bitcoin has dropped dramatically in recent days,” he said in the memo. Investors are clearly looking to buy a large-scale purchase from the U.S. Treasury Department immediately. Instead, they learned that the reserve will initially include the government’s existing Bitcoin holdings (estimated at 200,000 BTC), worth about $16 billion at its current price.
Hougan believes that the negative reactions in the market are unfounded, stressing that only 200,000 bitcoins were retained instead of selling these reactions, rather than selling them (once expected under previous governments) would be pending from the market in large quantities.
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Furthermore, the new executive order clearly states: “
Hougan emphasized the importance of the word “responsive” in the memorandum, which shows that it indicates authorization rather than just possibility. Most importantly, Bitwise’s memo sticks to a long-term perspective, urging investors to focus on what Hougan calls “the only important issue in Bitcoin.” The question is whether Bitcoin becomes important globally, similar to gold, or is it still peripheral.
“If Bitcoin does matter globally, here’s my point: It’ll be $10-50 trillion in assets, which means getting a return of 5 x-25x from the current price. If that’s not the case, it’ll be a footnote in history, bounced just below $150,000, with support from a small group of liberals, Cypherpunk and speculators. There’s no between the two. Bitcoin is important globally or it doesn’t matter,” Hogan wrote.
From this favorable perspective, the choice of the U.S. government to retain (and possibly expand) its Bitcoin holdings represents a huge signal to other countries. If it’s like Hougan El SalvadorIndia is weighing its strategic moves in the digital asset space, with the U.S. adopting Bitcoin as the strategy can prompt them to follow suit, especially if they want to make any further acquisitions in the U.S.
Although some investors may be due to immediate lack A large number of government purchasesFaced with Bitcoin’s recent volatility, Bitwise’s memo remains optimistic. Hougan marks the current price drop as an opportunity for those who are paying attention to a longer timeline. “I saw a big takeaway. This short-term weakness is a gift,” he concluded.
At press time, BTC was trading at $80,319.
Featured Images created with dall.e, Charts for TradingView.com
