The cryptocurrency industry has officially entered a bear phase, according to Dr. Lin Han, founder and CEO of Gate.io.

Key Takeaways

• The crypto market has entered a confirmed bear cycle, with total capitalization shrinking from $4 trillion to $2.4 trillion.

• Bitcoin fell more than 50% from its October 2025 peak near $126,000 to around $60,000.

• Institutional sentiment reversed sharply, with ETF flows turning negative and assets under management nearly halved.

• Macro forces now dominate crypto cycles, replacing the traditional four-year halving narrative.

Speaking during a keynote address on February 11, 2026, Han acknowledged that the market is navigating one of its most challenging periods since the explosive rally that defined late 2025.

His remarks come as total crypto market capitalization has contracted sharply from its $4 trillion peak to roughly $2.4 trillion, reflecting widespread price declines and fading speculative momentum.

Gate Founder Dr. Han: What Should We Do to Return to a Bull Market?

On February 11, Gate Founder and CEO Dr. Han stated in a speech that.based on actual data, we are indeed currently in a bear market. The total market value of the crypto space has fallen from $4 trillion last… pic.twitter.com/s3iy8ftndn

— Wu Blockchain (@WuBlockchain) February 12, 2026

Bitcoin’s Collapse Reshapes Market Sentiment

Bitcoin remains at the center of the downturn. After reaching an all-time high near $126,198 in early October 2025, the asset tumbled to nearly $60,000 by February 2026 – a drop of more than 50%.

That decline has had a cascading effect across the broader market. Trading volumes have cooled, retail participation has thinned, and overall engagement across exchanges has softened. Han noted that falling prices inevitably reduce user enthusiasm, a pattern visible across major platforms.

Institutional Retreat Accelerates De-Risking

The late-2025 rally was fueled in part by aggressive institutional inflows. Weekly net flows into U.S. spot Bitcoin ETFs reached between $2.7 billion and $3.2 billion at the peak of optimism in October.

That dynamic reversed dramatically entering 2026. Year-to-date flows turned negative, ranging between -$1 billion and -$2 billion, while total assets under management fell from approximately $170 billion to nearly $80–$85 billion. Analysts cited $4.57 billion in outflows during late 2025 alone, signaling what many describe as structural de-risking rather than temporary profit-taking.

This institutional retreat underscores Han’s broader point: crypto is no longer driven primarily by its internal four-year halving rhythm.

Macro Now Dominates Crypto Cycles

According to Han, the traditional halving narrative has lost dominance. Instead, digital assets now move in close alignment with global macroeconomic trends, U.S. equity performance, and even AI-driven technological developments.

In his view, crypto has matured into a macro-sensitive asset class. Liquidity conditions, monetary policy, and risk appetite across traditional markets increasingly dictate price action. The sharp correction from late 2025 highs reflects that integration.

Focus Shifts to Real-World Utility

Despite acknowledging the bear market, Han expressed optimism about where the industry is heading.

He highlighted Real-World Assets (RWA) as a key catalyst for the next expansion phase. Tokenization of gold, equities, and commodities could bridge traditional finance and blockchain infrastructure, unlocking new liquidity channels and attracting more institutional capital.

Artificial intelligence is another pillar of his outlook. Han expects AI agents to become foundational infrastructure within Web3 ecosystems, improving portfolio management, automation, and interaction efficiency.

In his year-end 2025 letter, he described the industry as entering a stage of “structural maturity,” moving beyond short-term speculation toward compliance, infrastructure development, and tangible real-world use cases.

While volatility has shaken confidence, Han’s message suggests the downturn may represent a transitional phase – one that reshapes crypto into a more macro-integrated and institutionally grounded market heading into 2026.