Interview with Matthew Hougan, Chief Investment Officer at Bitwise Asset Management | EBC11

Hello everyone. Welcome back. We are here in Barcelona at the European Blockchain Convention. I'm Alyona Koko from the Alyona Koko from the Rebel PR agency. With me again this year is Anty Hogan, Chief Investment Officer at Bitwise.

How are you? I'm fine. It's great to be in Barcelona again. Very glad to see you here. We talked last year in September.

Yes. And I think it was one of the craziest years in the cryptosphere since then. Tell us briefly about the most interesting moments of the past year and what impressed you the most. Yes, there are actually many things that inspire. Perhaps the most important event of the past year, in my opinion, was the change in the attitude of US regulators towards cryptocurrencies.

We have gone from huge obstacles, when everything was very difficult and almost illegal, to a powerful incentive that allows us to move the industry forward. You see the result in the flow of funds into ETFs. You see the result in the adopted legislation. And you see the result in the industry really focusing on real-world applications. Another big change for me big change for me : I think a year ago, if we were talking, crypto was still mostly a Bitcoin story, at least to the outside world.

Within the crypto community, we have, of course, talked about different assets and applications. To the outside world, it was just Bitcoin. The world has finally discovered stablecoins, tokenization, and what can be done beyond Bitcoin in the cryptosphere. And I believe this is a big change that will have consequences for many years to come. One hundred percent .

Also, a year ago it seemed that Europe or Latin America were ahead of the curve, perhaps pushing back the control and monopoly that the US had held for so long in the economy, and suddenly the country has once again seized the initiative and is leading the wave. Very interesting time. Yes. Yes. The largest market in the world.

They say about America that they choose the right path only after exhausting all other options. I think that's true here too. But I believe this is a fundamental shift fundamental shift . Many are asking whether the US will return to an anti-cryptocurrency stance if there is a change in administration. I don't think so.

This is not what we hear. I believe there is bipartisan support. I think we have taken a step of no return, and you can just look at how actively Wall Street is building crypto-based solutions to understand that this is a fundamental change fundamental change . One hundred percent . And also, maybe, the signal that the US gave, which pushed PayPal forward, and even, you know, the states creating their own tokens, and potentially the Trunk token.

Yes. I also don't think there will be a turning back will be a turning back . Yes. No, there is no return Yes. No, there is no return .

In fact, I think quite the opposite. I think you know, you mentioned PayPal. I wouldn't be surprised if the largest banks in the US launched their own stablecoins. We have already seen NASDAQ and the New seen NASDAQ and the New York Stock Exchange consider tokenization. So, everyone who was skeptical about cryptocurrency over the last decade has changed their mind, and I think it's a one-way street again.

I think it will only get better from now on. Yes. So, you know, we talked about Bitcoin and, you know, how it was the concept of the Bitcoin market. So, aside from Bitcoin and Ether, what interests or excites you most when it comes to digital assets on a more institutional level institutional level ? Yes, I really think the next biggest product in terms of institutional adoption, besides Bitcoin, is diversified baskets.

So, index products, I think, will become a trillion-dollar- plus market that people don't expect. The reason for this is that if you think about the people who have invested in cryptocurrencies so far, they are mostly crypto experts. These are people who know Bitcoin, Ethereum, and Solana. The people who will drive the market in the future are those who are not focused on cryptocurrency, who just want to allocate 3-5% of their portfolio, and they don't have their own opinion on how layer 1 should be structured or whether it is better to scale through a monolithic blockchain or through a layer 2 solution. They just want to own cryptocurrency, and I think they will buy index solutions.

I know it's a very tiny market share right now. I think if we come back next year, it will be 10% of the market. If we come back in two years, it will be 30–50% of the two years, it will be 30–50% of the market. I believe this is a big area for growth. Wow, that's very interesting.

Um, speaking of indices and ETFs as well, you know, as a more acceptable, let's say, financial product for the masses, how do you see that side of the market developing as well ? Yes, I mean, definitely. What we see with ETFs is historically that flows increase over time . This was true beyond cryptocurrency as well. I think this will be true in the cryptosphere as well.

So I believe we are only seeing the first installment. It is worth noting that, at least in the US, the market is not yet fully open. Some of the largest wealth management platforms are only now starting to provide access to Bitcoin ETFs. Many people are delighted with what we saw, well, how to say it? One hundred billion dollars in investment worldwide.

Um, this is really just a down payment. I mean, in 2025 we will see record numbers. I think 2026 will surpass 2025. I think 2027 will surpass 2026. If you look at the history of ETFs, they usually grow over 5-10 years.

And I think we'll see the same thing here. Very cool. Um, is there anything else you want to add? Um, you know, for our viewers? No, I would just say, probably the most important thing I can say is that now is the best time to invest in cryptocurrency.

We have eliminated a huge amount of risk. People rarely think about it , but we have significantly reduced the risks of custody, trading, regulation, and institutional and state acceptance. We have minimized all these risks, but there is still no agreement on crypto . Most investors still have 0% allocation to cryptocurrency. Therefore, I believe you have huge growth potential with significantly less risk.

As an investor, this is very inspiring to me. I think this means that people will allocate more funds to crypto than before. Again , a few years ago we were probably talking about 1% of talking about 1% of the distribution. I think in the future it will be five, maybe ten percent. So, it's still early days in crypto .

We have reduced the risks. I think we have a very exciting time ahead of us. 100% of the time. It's really funny to us, you know, being in the crypt for so long and still thinking we're in the early stages. This is still such a beginning.

This and the industry moves so fast, you know, everything happens so fast. It feels like a whole decade has passed, and it has. Yes. We are in that exciting phase of scaling. You know, if you think about an exponential curve, it takes a long time to go from one to two, from two to four, from four to eight.

Um, but we're at a point now where things are really accelerating. I think it will be interesting. This is a very exciting time. Let's see. Let's see what we'll be talking about next year.

OK. So, thank you for joining us.