He noted that while the overall market is positioned for growth, predicting which specific tokens will outperform remains challenging.
Crypto News
Funds tracking baskets of cryptocurrencies will likely surge in popularity as investors seek broader digital asset exposure, according to Bitwise Chief Investment Officer Matt Hougan. The prediction comes as the market expands beyond Bitcoin dominance.
Hougan stated Monday that crypto index funds will become significant in 2026 as the market grows more complex and use cases multiply. He noted that while the overall market is positioned for growth, predicting which specific tokens will outperform remains challenging.
The investment chief argued that owning a fund tracking the broader market provides a solid starting point for investors, though he acknowledged the approach does not suit everyone. Multiple exchange-traded fund issuers, including Bitwise, offer products tracking various cryptocurrencies, similar to how the S&P 500 tracks top U.S. companies.
Multi-crypto ETFs launched in the U.S. earlier this year, holding digital assets proportional to each token's market capitalization. These products have seen modest inflows as Bitcoin currently dominates nearly 60% of the market.
Hougan stated he cannot confidently predict which blockchain will succeed or how developments will unfold, despite his experience and network of crypto experts. He described accurate forecasting at this stage as unknowable, shaped by regulation, execution, macro conditions, actions of key individuals, luck, and numerous other variables.
Crypto markets rallied from November 2024 through January following Donald Trump's presidential election and inauguration, remaining elevated on pro-crypto policy expectations. However, the sector has experienced negative effects from sweeping U.S. tariffs and uncertainty over further interest rate cuts as traditional finance involvement increases.
Hougan's approach focuses on buying the market through market-cap-weighted crypto index funds. He stated crypto will be far more important in 10 years than today, with potential for 20x growth over that period.
Securities and Exchange Commission chair Paul Atkins commented Wednesday that the U.S. financial system could embrace tokenization within a couple years. Hougan emphasized that stablecoins, tokenization, and Bitcoin will all matter more going forward, with dozens of other major use cases following in areas like prediction markets, decentralized finance, privacy tech, and digital identity.
Hougan himself uses a crypto index fund as his portfolio core, ensuring exposure to potential winners regardless of how the market evolves.
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