Bitwise says Bitcoin’s floor is rising amid AI boom and regulatory delays

Bitcoin’s downside support is getting stronger, even as a trillion-dollar AI spending spree and stalled crypto legislation create headwinds for the market. That’s the read from Bitwise’s Juan Leon, who laid out a surprisingly bullish case on July 9 for why the largest cryptocurrency’s price floor keeps ratcheting higher.

Leon, Bitwise’s Senior Investment Strategist, pointed to a split among institutional investors that tells an interesting story. One camp is treating recent price pullbacks as a buying opportunity. The other is parked on the sidelines, waiting for US regulators and lawmakers to provide the operational clarity they need before deploying capital.

The institutional tug of war

During previous market downturns, institutional holders of Bitcoin ETFs, including Bitwise’s own BITB product, displayed what the firm describes as “diamond hands.” They held through volatility rather than panic-selling, a behavior that naturally creates a rising floor under the asset’s price.

The more cautious players are waiting specifically for movement on the Clarity Act and other pending crypto legislation that has been grinding through Congress. These are the types of allocators who need a clear legal framework before their compliance teams will sign off on meaningful positions.

AI is eating crypto’s lunch, at least temporarily

Hyperscale companies have been pouring money into AI infrastructure at a staggering rate, with capital expenditure in the AI sector projected to exceed $1 trillion across 2025 and 2026. For asset allocators with finite budgets and limited risk appetite, AI has been the shinier object.

Leon acknowledged this dynamic but framed it as temporary rather than structural. The AI boom doesn’t diminish Bitcoin’s value proposition, it just delays the timeline for broader institutional adoption.

Stablecoins tell the real story

By mid-June 2026, the total stablecoin market cap had reached $322 billion, a figure that reflects deep and growing institutional engagement with on-chain finance. Stablecoins serve as the plumbing of the crypto economy. When their market cap expands, it typically means more capital is being parked on-chain, more transactions are flowing through decentralized rails, and more institutions are experimenting with tokenization.

What this means for investors

The risk is that regulatory clarity takes longer than anyone expects, or arrives in a form that disappoints. If the Clarity Act gets watered down or delayed into 2027, the cautious institutional capital sitting on the sidelines stays there.

Bitwise’s positioning here is also worth noting. The firm manages the Bitwise Bitcoin ETF and has a direct commercial interest in institutional adoption of crypto. The most useful signal isn’t what any single strategist says. It’s the behavior of the ETF holders themselves, who have consistently chosen to hold through drawdowns rather than exit.

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