Bitwise CIO Matt Hougan says Strategy will no longer be bitcoin's top buyer. In a detailed memo and an interview a week later, he pointed to banks, pension funds and sovereign funds as the market's next big driver.
Bitcoin has shown resilience lately, even as many investors and analysts argue the market remains in a bear phase. Hougan takes a different view: he believes the downturn is nearing its end, pointing to signs of consolidation rather than collapse. So far in July, bitcoin has outperformed most other asset classes, and Strategy's record bitcoin sale earlier in the month barely moved the price at all – a signal Hougan considers more important than speculation over Michael Saylor's next move. Instead, he's focused attention on who becomes bitcoin's next marginal buyer.
In an internal CIO memo published July 1, Hougan laid out why in detail. Strategy had just introduced a new framework for its perpetual preferred stock, STRC – an instrument that pays investors dividends, and which Strategy has used to fund bitcoin purchases. The framework allows the company to periodically sell bitcoin to cover dividend obligations.
Hougan put numbers to the situation: Strategy held roughly $49.6 billion in bitcoin and $2.6 billion in cash, against $6.8 billion in debt and $15.5 billion in preferred equity obligations. He dismissed fears of forced liquidation as mathematically unlikely, and compared the STRC turmoil to the collapse of Grayscale's GBTC premium in 2019–2021 – both cases where capital drawn in by favorable market conditions had to be worked out of the system before the market could find a bottom.
The institutional shift is not a new observation from the Bitwise CIO. Kaupr interviewed Hougan at the European Blockchain Convention (EBC) in Barcelona in the fall of 2025, where he described the approval of U.S. bitcoin ETFs as a global turning point for digital asset investing – a development he said was only the beginning of a larger institutional allocation into bitcoin, with knock-on effects for DeFi and tokenized assets as well. July's message is thus a continuation and sharpening of a thesis Hougan has built over nearly a year, now aimed specifically at Strategy's diminished role.
It was only after Hougan repeated and sharpened the message verbally in an interview with the Milk Road Show on July 8 that analysis and commentary really began piling up. "The next marginal buyer is the end boss of investing... It's institutional capital," he said. He noted that bitcoin barely reacted to Strategy's bitcoin sale earlier in June, taking it as evidence the company is no longer the market's primary source of marginal capital.
TheStreet followed up on the interview the next day, July 9. Four days later, on July 12, Hougan expanded on the reasoning in an interview with Fortune. Leverage built up during the boom is now being squeezed out of the system, he said, pointing to falling open interest in derivatives markets and a pullback among digital asset treasury companies that drove much of the previous bull cycle. "Strategy is basically the only company that actually keeps buying Bitcoin," he added. According to Hougan, this is also a matter of investor psychology: bitcoin's well-known four-year cycle has conditioned investors to expect long-term holders to start trimming positions toward the end of each period – something he believes is now underway. The pattern is clear: the further into July, the more attention has shifted from Strategy's next move to the question of who is actually buying.
Strategy's central role in the bitcoin market has worried some investors for a while. Short seller Jim Chanos has bet against the stock for some time, and capital markets veteran Bob Sloan of S3 Partners has warned that the market leans too heavily on a single buyer. When Strategy reported its largest single bitcoin sale ever earlier in July – 3,588 BTC for around $216 million – the expected sharp price reaction never materialized. For Hougan, that underscores the point: the question is no longer what Strategy does, but who takes over as the market's marginal buyer.
Findings from this week lend the thesis further support, with no involvement from Hougan. CoinDesk reported July 14 on Glassnode's RHODL Ratio – which measures the wealth held by long-term holders against that of newer investors – which recently hit its second-highest reading ever before beginning to decline. Unlike the collapse during the FTX crisis in 2022, this decline is happening without panic selling, suggesting a gradual consolidation phase: bitcoin is changing hands from long-term holders to a new generation of buyers who see the current price as an attractive entry point – exactly the kind of buyer Hougan has pointed to since last fall.
Sources: Milk Road Show, Bitwise, CryptoPotato, TheStreet, Fortune, New York Post, CoinDesk, Kaupr
See also Matt Hougan interviewed by Kaupr
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