BlockBeats News, July 10th, Bitwise's Senior Investment Strategist Juan Leon stated that the current Bitcoin bear market is fundamentally different from previous cycles, with increasing institutional adoption, while the market is also influenced by the AI ​​boom, macro uncertainty, and the delayed US crypto legislation. Bitwise's institutional clients are roughly divided into two categories: investors who have allocated to Bitcoin in the past two years view this downturn as a rebalancing and dollar-cost averaging opportunity, while another group of large funds is still awaiting a clearer regulatory framework. He said, "In 2022, clients were asking if cryptocurrency could survive; in 2026, they are asking about entry points and position sizes. This is a completely different conversation."

Leon believes that the current correction is the "most structurally mild bear market" in Bitcoin's history, with a current retracement from the high point of about 50%, lower than the 78% in the 2022 bear market and 84% in the 2018 bear market. He stated that the bottom of each Bitcoin cycle is rising, reflecting the asset's gradual maturation, with marginal holders transitioning from retail speculators to professional asset allocators.

However, Leon also acknowledges that Bitcoin could still see further downside, as past bear markets have usually lasted about 12 to 13 months, while the current one has been about 8 months. He pointed out that some traditional bottom signals have begun to appear, including oversold momentum indicators, about half of Bitcoin holders in a loss position, long-term holders accumulating again, and record outflows from the June spot Bitcoin ETF. The current issues in the crypto market stem more from the macro level rather than the fundamentals.

Leon also stated that the AI ​​boom has attracted tens of billions of dollars of funds that might have otherwise flowed into the crypto market. Since April, semiconductor ETFs have attracted approximately $12 billion in inflows, while spot Bitcoin ETFs have seen outflows exceeding $4 billion. With market digestion of AI capital expenditure expectations, relative valuation contraction, allocators may be looking for assets that have retraced about 50% from their highs and have improved fundamentals. He also believes that AI and crypto will gradually move towards complementarity, where AI entities may rely on programmable money, intermachine payments, and stablecoin rails.