Five Forces Fueling Crypto's Next Bull Cycle

Bitwise Asset Management's Chief Investment Officer Matt Hougan outlined five forces driving a potential new bull cycle in crypto. Unlike previous cycles, this one is being driven by multiple catalysts compounding together, including regulatory tailwinds, institutional adoption, stablecoins and tokenization, on-chain finance, and revenue-generating tokens.

Hougan pointed to the SEC's shift under Chair Paul Atkins from enforcement actions against major exchanges to a more lenient approach. The agency has dismissed lawsuits against Coinbase and Kraken and continues to loosen rules around token trading through its Project Crypto initiative.

Regulatory clarity has allowed institutions like BlackRock, Nasdaq, NYSE, and DTCC to operate in the space, building businesses rather than just allocating to crypto markets. This shift is driving adoption, with wealth managers' capital market assumptions moving from debating whether to hold any crypto at all to allocations that roughly double what many portfolios held a few years ago.

Hougan noted that billions have poured into Bitcoin and Ethereum ETFs in the past month alone, with hundreds of millions more into funds tied to XRP, Solana, Hyperliquid, and Chainlink. Bitwise's own Bitcoin ETF charges a mere 0.20% expense ratio.