Bitwise CIO Predicts $1 Trillion Entering Crypto Markets

Matt Hougan calls the $12 billion already allocated through ETFs “barely a down payment.”

By: Pedro Solimano Loading...

image depicting institutions investing in crypto

Institutions are getting ready to flood the crypto markets with capital, according to Matt Hougan, CIO of Bitwise, one of the firms that offers a spot Bitcoin ETF.

“The January launch of spot bitcoin ETFs opened up the crypto market to investment professionals in a major way for the first time ever,” wrote Hougan, pointing out that these investors control tens of trillions of dollars.

For Hougan, who explained that a 1% allocation could translate to $1 trillion entering the crypto market, the funds geared to enter the market will take years, not months, calling for investors to “think about the implications.”

Bitcoin trades today for $69,706, kicking off the month with a 1.2% drop. The asset has experienced significant volatility after hitting its recent all-time high, dropping to a low of $61,494 on March 20 but recovering to its highest monthly close ever on March 31..

BTC Price chart
BTC Price

Spot Bitcoin ETFs have been on an accumulation spree since launching on January 11. Collectively, the nine funds now hold more than 831,000 BTC – a whopping 4.23% of the network’s total supply, according to a Dune dashboard.

Bitwise controls 30,734 BTC on behalf of its customers, worth more than $2.1 billion.

But bulls like Hougan think this is just the tip of the iceberg.

And $1 trillion entering an asset with a $1.3 trillion market cap certainly has bullish implications.

“We are all excited about the $12 billion that has flowed into ETFs since January, but imagine global wealth managers allocate just 1% of their portfolios to Bitcoin,” wrote Hougan, calling the move “not crazy.”

Hougan, who spoke on January 14 to The Defiant to discuss the spot Bitcoin ETF market, referenced the Bitcoin halving, earmarked for mid-April, as an important catalyst for large investors to start buying, along with news that banking behemoths Morgan Stanley and Wells Fargo should start offering their own Bitcoin ETFs in the coming weeks.

“1% down, 99% to go,” he wrote, advising investors to keep calm and take the long view