Bitcoin Stumbles — But Cathie Wood Firmly Believes Long-Term Bull Case Is Still Alive

As BTC lags equities and traders crowd into gold, ARK’s Cathie Wood argues Bitcoin is quietly maturing, not breaking.

• Bitcoin is down 16% over the past year and trailing equities, but Wood says lower volatility signals a shift toward institutional ownership, not a broken thesis.
• ARK has adjusted its Bitcoin framework for emerging markets as stablecoins increasingly dominate remittances and payments use cases.
• Wood said recent market stress, including a $28 billion liquidation event tied to a Binance software issue, has not changed ARK’s long-term outlook.

Bitcoin is not off to a great start in the new year. It's lagging the benchmark S&P 500 and Nasdaq indices, as traders flock to safe-haven gold and silver to hedge rising geopolitical uncertainty. But Ark Investment Management CEO Cathie Wood is not giving up on the cryptocurrency just yet.

The 70-year-old veteran investor has seemingly shrugged off BTC's 16% dip over the past year, saying the digital asset's long-term case remains intact, even as its role in global markets continues to evolve.

Speaking in an ARK Invest video released after the firm's Big Ideas 2026 research report on Friday, Wood addressed concerns around Bitcoin's recent consolidation and changing market behavior. She said Bitcoin's volatility has declined significantly compared with earlier cycles, reflecting its transition from a retail-driven, speculative asset to one increasingly held by institutions.

Bitcoin's volatility reached an all-time low in October 2024, after peaking earlier in the cycle at $126,080. Wood said this shift has altered how Bitcoin trades in the short term, but does not weaken its longer-term role as a store of value.

Bitcoin (BTC) was trading at $87,703, down 1.3% over 24 hours. On Stocktwits, retail sentiment around Bitcoin dropped from 'bearish' to 'extremely bearish,' while message volume improved from 'normal' to 'high' over the past day. 

She also said ARK Invest has adjusted parts of its Bitcoin framework, particularly around emerging-market payments. Wood noted that stablecoins have increasingly taken on use cases, such as remittances and day-to-day transactions, that ARK once expected Bitcoin to fill.

"In terms of remittances and emerging market activity, we're seeing stablecoins usurp the role we thought Bitcoin would provide," Wood said.

However, Wood emphasized that this evolution does not diminish Bitcoin's long-term positioning. She said Bitcoin's fixed supply and mathematically capped issuance continue to distinguish it from traditional assets, including gold.

Flash Crash And Market Structure

Wood also addressed a sharp market drawdown earlier this year, which she attributed to a "software glitch" at Binance. She said automated deleveraging during the event led to roughly $28 billion in forced liquidations, distorting price action across crypto markets. Wood said ARK believes the market has worked mainly through the impact of that episode.

The comments refer to the early October liquidation event last year, which was among the biggest single-day liquidation episodes on record and amplified short-term volatility across major crypto assets. She added that such events contribute to short-term volatility but do not alter ARK's broader outlook. 

Rethinking The 4-Year Cycle

Wood said ARK does not believe the traditional four-year crypto cycle applies as cleanly as it once did, citing increased institutional participation, the rise of stablecoins, and evolving regulatory frameworks.

She also reiterated that Bitcoin's correlation with gold has remained low throughout its history, reinforcing ARK's view that Bitcoin can act as both a risk-on and a risk-off asset depending on macro conditions.

ARK's report said Bitcoin's long-term outlook remains tied to adoption trends, concerns about monetary debasement, and its role in a changing global financial system, even as its use cases continue to mature.

Read also: ‘Not Going to Zero? Then It’s Going to $1 Million’: Anthony Pompliano Doubles Down on MSTR And Bitcoin

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