"Most People Have No Idea What's About To Happen" - Matt Hougan

[00:00:00]I think Bitcoin at this point uh will be driven by these behavioral cliffs. And so I would look at something like 250K, which is a big move from where we are today at $60,000. [music] I don't think that's the end. You know, I've been on the record of saying I think we're going north of 1.3 million by 2035, but I do think you'll have these behavioral cliffs. I think the next one is at 250. And um once we get through this bottoming process, uh I think it's going to be a great a great bull market. You know, look, the world is still getting more digital. Young people are getting older and wealthier.

[00:00:32]Fiat is still being debased. There's still a huge need for Bitcoin. So, I think it's going to be just fine. And [music] yeah, I I'd suspect the next leg takes us up to 250 before we have some sort of modest retracement.

[00:00:43]>> According to Matt Hugan, one of the biggest opportunities in cryptocurrency may be hidden by the current market turmoil. According to Hugan, institutional adoption, ETF demand, and expanding worldwide acceptance might propel Bitcoin into a new phase of growth. Even though many investors are still cautious and concentrate the short-term volatility, could Bitcoin be headed for another huge rise as significant players keep strengthening their positions? Even the most bullish investors can be taken aback by the upcoming cycle. In this video, we analyze Matt Hugan's most recent Bitcoin perspective, the main elements that might influence the market's future, and the reasons he is still very optimistic.

[00:01:18]If you're intrigued by bold predictions and deep financial insights, make sure to like this video, subscribe to the channel, and turn on notifications for more engaging content. Thank you for your support and enjoy the video. How are you feeling about BTC right now?

[00:01:30]Look, I think this is a classic late crypto winter. Uh it feels like that in every way, shape, or form. If you think about what drives the crypto cycle from my perspective, you get a bull market.

[00:01:42]You get a buildup of leverage in the system and then that gets over its skis and the leverage has to be squeezed out.

[00:01:48]That's exactly what we're seeing in the market right now. We're seeing funding rates that are relatively constrained.

[00:01:53][music] Uh we're seeing sentiment gauges that are relatively bearish. We're seeing financial [music] proxies like Micro Strategy and Stretch suffer stress events, which is a classic way that leverage unwinds in the system. So, to me, we're getting close to the point where we're finding a bottom. Another tell for me, Alex, is that things have been feeling really bad in Bitcoin for a handful of weeks, but the price hasn't really fallen that much. I keep looking at it feeling like it's down a lot, and it's actually still hovering here around $60,000. So, I think we're in for a continued period of short-term volatility, but I still feel very confident that the end of the year is going to be very positive, and I think we're starting to emerge into the next crypto spring. How how does the sentiment compare now compared to previous bare markets in your opinion?

[00:02:40]>> Yeah, it reminds me a lot of the 2018 2019 bare market. So, the 2022 bare market was cataclysmic, right? We just went through Q2 2026 and the market was down about 15%. In 2022, in Q2, the market fell, I think it was 55, 60%, it was truly cataclysmic. So, it doesn't feel like that. It reminds me a lot of that 2018 2019 bare market. We had a nice run up in 2017, first the first sort of mainstreaming of Bitcoin [music] and then we pulled back to about $5,000 and we treaded water for a while there and then we had a pull back further to 3,000 and people got angry [music] and apathetic. That's what it feels like right now. Certainly the vibes are negative. Uh you see a handful of people sort of rage quitting on Twitter. Those are all signs we're nearing the bottom.

[00:03:31]So this feels exactly like that period to [music] me. And sure enough, we bottom from that period and went to all-time highs. I think if you look closely under the surface, you can see the green shoots in there. We could talk about some of those green shoots that may be confident that we're going to find that next bull market. But yeah, this feels like the 2018 2019 bare market to me. [music] We're at the apathetic, angry phase of that bare market. And that makes me think that the next bull market is just around the corner.

[00:03:59]>> How is it possible that uh this this 4year cycle is is still alive?

[00:04:04]>> Yeah, I'll tell you the mistake that we made which maybe other people in the industry made, which is that we spoke to our core audience. Now, Bitwise serves a wide variety of investors, but our primary audience is institutional. It's financial advisors. It's family offices, it's Wall Street, it's sovereign wealth funds. Those are the people we're meeting to on a day-to-day basis. And for those people, I do think the four-year cycle is dead. I know there have been a few outflows from Bitcoin ETFs, but generally speaking, the trend is up and to the right. You're seeing net inflows, net adoption. You're seeing approvals on Morgan Stanley, approvals on Meil Lynch, integration on Wells Fargo. you're seeing all the signs of a really a super cycle of institutional adoption. And the reason we said the four-year cycle was dead was those are the people we speak to every day. And I think we were right. What we missed, which is obvious in retrospect, and I feel sort of embarrassed that we missed this, [music] but what we missed is the majority of Bitcoin is still held by retail investors. And those retail investors [music] are entrenched in the 4-year cycle. It's how they view the world. They're the ones who have historically built up leverage that gets to an excess point who have ex historically moved into sort of the financial engineering tools that extend market cycles and get them over their skis things like micro strategy things like stretch things like Bitcoin treasury companies and those are the majority of the market so look I think the four-year cycle is actually still intact I think it's exists because retail remains a twothird owner of the Bitcoin that exists in the world you do have this institutional bid, which is why this cycle is more shallow than previous cycles. It's also why I think maybe we'll have even more upside in the next cycle than we have in the past cuz [music] that institutional bid is real.

[00:05:56]But I think that's the disconnect.

[00:05:57]Institutions are in a 10-year super cycle. Retail is still in this 4-year cycle and we happen to be in that [music] down phase. Do you want to expand a little bit on that on just how the institutions are are viewing the space?

[00:06:10]>> Yeah, absolutely. I would say there sort of two groups. They're the people who allocated before the October 10th or the October uh highs in Bitcoin. And those people have actually been adding to their allocations. So, they were pre-sold on the long-term Bitcoin story.

[00:06:24][music] They're worried about fiat debasement. They believe that the world is increasingly digital. They believe Bitcoin has an incredible track record of adding to the riskadjusted returns of portfolios. And we've seen those clients, you know, averaging into the pullback, using lower prices to build larger positions. That's beautiful to see. I will say that the people who didn't quite get over the line before the pullback started, they are engaged in studying Bitcoin, but they have been slow to make that first allocation. They had questions about quantum. They have questions about where the bottom is.

[00:06:59]They're worried about momentum. They're thinking about the clarity act and whether that is a piece of uncertainty that could send the market to yet another low. So they have been slow to adopt. Big picture, they're all still moving forward. You know, our cadence of meetings and indeed our inflows have been very strong in Q1 and Q2 because they are still in that adoption phase.

[00:07:22]But there is a little bit of a break. If you didn't get in before the all-time highs, you're actually reluctant [music] to buy until we see a bottom. But the other people who bought are averaging in and buying more. I I think they'll be very strong buyers in in Q3 and Q4. I do think that that is just progressing down the track.

[00:07:40]>> Although the majority of institutions still prioritize Bitcoin, Matt Hugan thinks there are a number of other aspects of cryptocurrency that are receiving significant attention. Among them is Hyperlquid, which has emerged as one of the best performing significant cryptocurrency assets. Larger investors searching for new chances have naturally taken notice of it due to its remarkable growth and outstanding market performance. The growth of stable coins and tokenization is another significant development. Traditional assets may eventually migrate to blockchain networks according to many significant financial firms. This implies that in the future assets like stocks, bonds, real estate, and other financial items might be represented as digital tokens, facilitating quicker, simpler, and more accessible international exchange.

[00:08:19]Please take a moment to like this video, subscribe to the channel, and enable post notifications for future Bitcoin, macroeconomic, and digital asset content before we go any further. Now, let's get into his powerful [music] predictions.

[00:08:31]>> Where do you see Bitcoin topping out in the next bull market?

[00:08:35]>> In the next bull market, I'm glad you asked me that question. Substantially higher than the previous one. I wouldn't be surprised to see it. I I certainly think you'll get a double from the last top, uh, which is to say up to 250K.

[00:08:48]That's probably a nice behavioral number at which some point some people will sell. I think Bitcoin at this point uh will be driven by these behavioral cliffs. And so I would look at something like $250k, which is a big move from where we are today at $60,000. [music] I don't think that's the end. You know, I've been on the record of saying I think we're going north of 1.3 million by 2035, but I do think you'll have these behavioral cliffs. I think the next one is at 250. And um once we get through this bottoming process, uh I think it's going to be a great a great bull market. You know, look, the world is still getting more digital. Young people are getting older and wealthier.

[00:09:26]Fiat is still being debased. There's still a huge need for Bitcoin. So, I think it's going to be just fine. And yeah, I I'd suspect the next leg takes us up to 250 before we have some sort of modest retracement. Would that imply that diminishing returns maybe become less of a thing as we as we go out? Do you think that perhaps debasement and and the other catalyst that you mentioned could push it sort of above that uh that >> Yeah, I I look I think that growth curve >> I think I think we could get enormous growth. I think we could get enormous growth. I mean, remember the the the if you if you want to create an image of your mind of why the next cycle could be really significant, remember that the previous cycle's largest buyer was Michael Sailor and this cycle's largest buyer is probably something like sovereign wealth funds. And who has more capital to deploy? It's clearly sovereign wealth funds. So, we're getting into bigger and bigger investors. Now, it's harder to drive this number up. you're starting to talk about trillions of dollars of assets to make the price go up 100%. But there is still a huge amount of upside in this market if those institutional investors come in. So yeah, I'm absolutely, you know, more bullish than I've ever been long-term. And yeah, I can't wait to see the next cycle unfold. We've been doing this a bit wise since 2017. So we've seen a few of these cycles. Everything I'm seeing in the market suggests to me we're close to the bottom of this pullback. and everything suggests to me that this next leg of the relay driven by institutions will be significant.

[00:11:00]>> Are there any other winning narratives or like the green shoots that you me that you mentioned before that the institutions are looking at >> for sure there probably three that are worth calling out. The obvious one that everyone inside and outside of of crypto is talking about is Hyperlid which is just a unique secular story. It's been the best performing large cap crypto asset. uh money chases returns and a good story and hyperlquid has both. So that has attracted [music] some institutional allocation. We've seen that in our uh B hype ETF that we offer.

[00:11:32]Uh the second one is tokenization and stable coins. So institutions are very sold on the idea that stable coins will be a big deal in the future and that all assets will eventually be tokenized.

[00:11:45]They don't know exactly how to express that. [music] Does that mean buying Circle? Does that mean buying Coinbase?

[00:11:51]Does that mean buying ETH? Does it mean buying Salana? What about Chain Link?

[00:11:54]They're not sure exactly which button to push, but they are very interested in pushing that button. I think because if you're in Tradfi, you know just how sclerotic and dumb the underlying financial ecosystem is. So I I I do think they're looking for replacements and they look amongst that list of assets for what to buy. The third one, which we're just starting to see, is renewed interest in the DeFi space.

[00:12:18][music] The reason for that is you have large firms now, firms like Black Rockck working on things like Morpho. You're starting to see DeFi enter this institutional world. And so there's a little bit of interest there, but mostly it's Bitcoin, it's hyperlquid, and it's some way to play stable coins and tokenization. Those are the big three that are attracting interest. Do you think that strategy is becoming like more of a a headwind for for future Bitcoin price appreciation or do do you think Sailor's just like doing his own thing and it's pretty much irrelevant what he does now? I think they're less important than they used to be. So they've been the biggest driving force from a supply demand perspective in Bitcoin for a number of years and I think that era is over. I don't think they're going to be the biggest accumulator at all. I think that's going to be institutional capital through the ETFs and other means including direct access at brokerages and other places.

[00:13:10]That's going to be the big dog. [music] For what it's worth, this is not the first time we've seen that transition.

[00:13:15]Right before it was strategy, it was GBTC, which remember got up to 650,000 Bitcoin. Not that far from strategy stack. So they got they got a lot of Bitcoin at one point. Uh before that it was US retail. Before that it was Asian retail. Before that, it was Cippy Punks.

[00:13:32]Bitcoin is a is a story of like a track relay race [music] where the leading provider hands off the baton. It just got handed off to institutional investors, which [music] is sort of the end boss anchor leg, and they're going to have to run with it if Bitcoin's [music] going to succeed. So, I feel I think it's fine. I just think they're not going to be the unilateral force that they used to be. From my perspective, them selling Bitcoin was a good thing because it gets them out of the headlines. And actually, if you look at what happened in the market, unlike that commentary, you saw Micro Strategy rally, you saw a stretch rally, and you saw a [music] Bitcoin rally. And I think that tells you what the market really thinks about this, which is it understands strategy is not the primary accumulator of Bitcoin over the next 5 years. And it wants it to not be a massive headwind [music] either. In order to make that a reality, it has to have enough cash to pay its dividends.

[00:14:27]So, it has to sell a few billion bitcoin dollars in Bitcoin eventually. It's probably going to do that and that's probably fine. I actually think it's a very positive step. I think they're acting like a mature actor. The the the other thing they could have done is just stressed the system. They could have issued more stretch below par. They can do that. It just makes it more costly and bought more Bitcoin. They could have let their cash bleed down to the point where they might have to sell a lot of Bitcoin all at once. So rather than do that, they took a responsible step that removes them from the headlines a little bit. I think it's a huge win for Bitcoin. Again, the the next leg of Bitcoin is not going to be built on digital asset treasury companies, just like that leg followed the leg from GBTC, which followed the leg from US retail investors and so on. It's institutional capital that's really the story going forward. And I think there's going to be a huge bid from that. And as a result, I'm hugely bullish. According to Matt Hugan, institutions are still primarily focused on Bitcoin, but three other areas, hyperlquid, tokenization, and stable coins, and decentralized finance are beginning to receive significant attention. He says that Hyperlid's compelling growth story and solid results have drawn investors.

[00:15:40]Institutions, on the other hand, are growing more interested in tokenization because they think conventional assets like stocks, bonds, and real estate may eventually be transferred to blockchain networks. They obviously regard blockchain as a key component of the future financial system, even though they are still determining which businesses or cryptocurrency assets will gain the most. Hugan also thinks that firms like Strategy won't be the only ones driving Bitcoin's next significant development phase. Rather, he believes that the largest source of demand would come from institutional investors via ETFs, brokerages, and financial platforms. He likens the history of Bitcoin to a relay [music] race in which institutions are currently leading the way after many groups have passed the baton over time. Looking beyond Bitcoin, Hugen claims that actual income and economic activity will provide the long-term value of cryptocurrency initiatives. He thinks some cryptocurrency platforms have the potential to grow into strong, valuable companies as more financial assets are transferred to blockchain networks. For this reason, he is still very positive about bitcoins and the cryptocurrency industry's future. Remember to like this video, subscribe to the channel, and enable notifications if you thought his viewpoint was helpful so you don't miss any updates. We'd love to know what you think about the future of cryptocurrency markets. So, please share your ideas in the comments section. We appreciate your time and hope to see you in the next video.