"Something Is VERY Wrong With Bitcoin & Nobody Is Talking About it": Matt Hougan | Bitcoin 2026

[00:00:00]Bitcoin is holding below 70,000 but quietly setting up for one of the most significant demand shifts in its entire history. The next wave of Bitcoin demand is not coming from retail. It's not coming from corporate treasuries either.

[00:00:11]According to Matt Hogan, the biggest pool of capital in the world is finally moving in and the market has barely noticed yet. That shift is already visible in the data if you know where to look. And the story behind it explains why Bitcoin has been holding steady through bad headlines, war news, and months of what looked like selling pressure. the price hasn't broken down and Hogan has a specific reason why.

[00:00:31]Today we are walking through his full argument from who the next major buyer actually is to what the DeFi market is quietly pricing in to what happens when that institutional capital finally starts flowing at full scale. Let's get into it. But before we continue, quick reminder. Only a small percentage of you watching are actually subscribed. If this content is adding value, hit that subscribe button. It's completely free and helps the channel reach more people who need to hear this. We've gone nowhere uh since June. I actually take that as a pretty pretty big positive, right? Uh sentiment got really terrible at the end of June. It's picked up a little bit now, but we're basically trading where we were on like June 9th.

[00:01:10]I think when there is bad feelings and bad headlines, but the price is flattish, um that's probably good long term. But it's a little bit of a boring market right now.

[00:01:22]>> Yeah, it is a boring market. That doesn't mean that the news is boring though, you know. Uh I think that the key and I'm trying to find your I know you wrote a note and I had it pulled up but about STRC uh and Sailor. So I think this is just a continuation of what you just said because that was definitely the quote unquote bad news in the market for a while. And so I'd love your take as we do with every guest who comes on on you know what he did basically on Monday and how the market reacting because what we had for those who haven't been watching obviously he had a significant sale for the first time you know 200 plus million dollars worth of Bitcoin and the market kind of went up.

[00:01:59]>> Yeah. Yeah. Actually there were two important things that I would point out.

[00:02:03]The first is that when the full stretch freakout happened, right, when it traded to 74 and when Micro Strategy stock was getting crushed, Bitcoin didn't care. It traded flat. And that was one of the first times I had ever seen where Bitcoin didn't care what was happening to Stretch and Micro Strategy. And then, as you said, when he sold Bitcoin to raise cash to sort of push off any concern about strategy into the future, Bitcoin rallied. I think that tells you something pretty specific, which is that strategy was the big dog. It was the tail wagging the dog of the past few years of crypto. It was the biggest buyer. It was also arguably the biggest risk if it ever had to liquidate things.

[00:02:46]And now it's just become less important.

[00:02:49]The more it's in the rearview mirror and not front of stage, um I think the happier the market is in terms of the net buyer. It's absolutely true that I don't think it will continue to accumulate Bitcoin at the rate it has in the past. We may have even hit peak strategy Bitcoin. I doubt that, but it's of course possible. But it's no longer the person driving this forward. Uh the question is who it becomes. I think the answer there is obvious. It's institutional investors. But maybe more important is for people to reflect on the fact that we've seen this sort of baton transfer before, right? Before strategy, it was GBTC. Before GBTC, it was US retail investors. Before US retail investors, it was Asian retail investors. Before that, it was cipher punks. There have been like a series of leading buyers. We're now at the end boss of that series, which is institutional capital. And I actually think they're going to take it and run with it. So, I feel pretty good about where we are. But yeah, for sure Micro Strategy is not going to be the big buyer for the next 5 years of Bitcoin.

[00:03:56]>> There's something that happened in this market that most people missed because it didn't fit the narrative everyone was already telling. When the noise around strategy was at its loudest, when the stock was getting crushed and people were genuinely worried about a forced sale of hundreds of thousands of Bitcoin, Bitcoin itself didn't move. It traded flat. In previous cycles, anything that threatened the largest corporate holder of Bitcoin would have sent price down sharply. This time, it didn't. And then sailor sold a small amount of Bitcoin to raise cash and manage his balance sheet and price went up. Hogan's read on that sequence is clear. Strategy used to be the dominant force in this market. It was the biggest buyer. It was also the biggest perceived risk if things ever went wrong and now its grip on price has loosened. The market has outgrown it. That's actually a healthy development. A market that moves on one actor's decisions is fragile. A market that absorbs that actor's moves without blinking is maturing. Now, the bio rotation Hogan describes has a real historical arc behind it. Cipher punks gave way to Asian retail. Asian retail gave way to US retail. US retail gave way to GBTC and eventually to corporate treasuries.

[00:04:57]Each wave absorbed what the previous wave started and carried the price to a level the wave before it could not have reached alone. The wave that comes next is institutional capital, meaning financial advisers, pension allocators, sovereign wealth funds, endowments, and family officers. These are not people who move fast. They don't buy because of a tweet or a price chart. They allocate after months of research, internal approval processes, and due diligence that most retail investors would find exhausting. But when they move, they move at a scale that retail simply cannot match, and they don't panic sell.

[00:05:28]That's the distinction that makes this wave structurally different from every wave before it. Hogan is essentially saying the most patient and deepest pocketed buyers in the world are at the front of the line. That alone changes what the next cycle looks like and how durable it is. If I don't ask Matt Hogan about ETF flows, then I've not done my due diligence or duty for for a show. We had a bad run, right? I mean, they've reversed, I guess. I didn't see Tuesday, but I know Thursday was 200 in or so.

[00:05:54]Monday was 230ish, you know, just quoting off memory. Uh, after a kind of a sustained 10day streak, I think down, but then really months of selling. I mean, if we're just really looking at it.

[00:06:05]>> Yeah. And it felt different for what it's worth. So, we've in the past uh before Q2, we've seen periods where you had outflows. We've seen three, four, five, six days of outflows, including some chunky numbers, but it never felt like investors capitulating. I do think in Q2 it felt a little bit like investors capitulating. It was hundreds of millions of dollars out day after day after day after day. And um you know, I do think some weak hands got shaken out of that. It does feel like we've turned the corner. uh you're seeing a more a mix of inflows and outflows without the price going up. I think that's a positive sign. It suggests that if prices steady, you could start to see inflows accumulate, but um for sure I I think Q2 was was the first time I had seen sort of capitulative selling from ETF hands. Now, not all of it came out.

[00:06:57]there was still $50 billion dollars of net flows at at the low point. But um but you had some billions of dollars come out. It really did feel like a different moment in the market >> when people are asking you why. What's the answer? Because that that I mean that has to be a question that you guys are fielding now, right? Like because it was always you could always explain price, you could always explain narratives, you could always talk about AI rotation, all these things. But now you have a big like number that's being repeated in the media that probably is not helping uh in your first meeting sometimes.

[00:07:28]>> Yeah. I mean the the the short answer is uh it's it's a natural part of the four-year cycle. I really think that's what's going on.

[00:07:36]>> I was I was not a four year man. I really I got to take my L where I where I can. Like I kind of laughed. I mean the I guess the October height was pretty pretty curiously close but everything else didn't look like the four-ear cycle to me. But here we are. I mean, we guess we'll see what happens.

[00:07:50]Yeah, >> here we are. I mean, yeah, [laughter] let's hope the four year cycle holds at this point back up in October. [laughter] >> We'd hate to be have been right, but for the wrong reason. Um, I was skeptical, too. The mistake I made was I talked to institutional investors and by and large that audience is still buying. Bitwise had a pretty great quarter in Q1 for inflows. We had a great a good quarter in Q2. I won't call it great uh for inflows across the franchise. and that's our audience. But the thing I missed is that retail investors still control the bulk of of Bitcoin and they were net sellers into the four-year cycle. Now, I do think uh talking back about strategy and stretch. Uh one signal you're getting to the end of that cycle is when excess leverage and financial engineering gets squeezed out of the system. Right? You can think about GBTC trading from a premium to a discount in the 2021 2022 cycle. You can think about BlockFi and Celsius breaking as an example of financial engineering sort of breaking down. And you saw a little bit of that in late June with strategy trading below an MNAV of one with stretch trading to 75. That was sort of like a distressed signal that all the excess greed was was transformed into fear. That's the kind of thing that points to a bottom. Although, it's worth noting it doesn't always happen immediately, right? GBTC traded to a discount, I think, in relatively early 2021. It took a while to get to the end of that train. I think we're closer than that this time, but I I do think it's a signal we're we're at uh at a late stage of the bare market, and if we can get new demand from these institutions, I think we'll see the bull market emerge, you know, before the end of the year.

[00:09:38]Now, the ETF outflow data from the second quarter looked alarming on the surface. Hundreds of millions of dollars leaving day after day. For the first time, it felt like actual capitulation rather than just routine profit taking or short-term repositioning. But Hogan's point is that what looks like weakness from one angle can look like a clearing event from another. When markets flush out weak holders, what is left behind is a more stable base. The people who sold through that draw down were not the long-term allocators. They were the investors who came in without strong conviction and exited when things got uncomfortable. That's a painful process, but also a necessary one. Markets that never clear are markets that carry dead weight into the next move. The parallel to leverage unwinding is worth sitting with. In the 2021 to 2022 cycle, the financial engineering that broke down was GBTC trading at a premium, then a discount, and then lending platforms like BlockFi and Celsius collapsing entirely. Those were the signs that excess had built up to the point where the system had to reset. In this cycle, the equivalent signal was strategy stock trading below its Bitcoin net asset value and its preferred shares falling toward deeply distressed territory.

[00:10:42]Greed transformed into fear fast enough that it scared people who had not been scared in a long time. Hogan's argument is that this kind of signal, excess leverage getting squeezed out, historically marks a late stage in a bare market rather than the beginning of a new one. It doesn't mean the bottom is the next day. In 2021, GBTC started showing distress relatively early and it still took time before the real floor came in, but the signal was directionally correct. The more interesting detail he adds is what the ETF flow data looks like now in the period after that capitulation. Inflows and outflows are mixing without a strong directional bias and price is holding.

[00:11:17]That combination mixed flows and flat price is a different character than the one-way outflow pattern of the second quarter. It suggests that the sellers have mostly cleared and that the remaining holders are not looking to exit. If price is steady when there are still sellers in the market, what happens when the sellers are gone and the institutional buyers show up with size?

[00:11:34]>> From what I'm saying, you're still seeing demand for hyperlquid ETFs.

[00:11:39]>> Nothing nothing sells like prices going up. Uh yeah, Hyperlid is doing exceptionally well. I'll actually say uh an an overlooked story is that DeFi generally is doing exceptionally well.

[00:11:52]There aren't other DeFi ETFs you can point at, but if you just look at performance across, you know, we have a DeFi index that we track. Uh, it's up, I think, 30 or 40% over the last three months, even though broad crypto is down. That's an unusual divergence in a bare market. You don't usually get small caps rallying while the large caps decline in a bare market. That happens at the peak of a bull market, but that's what we're seeing in the DeFi ecosystem.

[00:12:20]I think Hyperlquid is the most public example because it's the largest and it has the ETF so you can track those flows. Uh but I think people are excited about Morpho. I think people are excited about a they're excited about Uniswap.

[00:12:33]They're, you know, growing on the Robin Hood chain. I think there is a whole sort of DeFi renaissance taking place and Hyperlid is sort of the the the beacon that's showing you that. But there's also below the surface uh I think interest in those assets as well.

[00:12:47]>> Yeah. So many questions. A obviously had that, you know, toxic collateral issue from Kelp Dow and obviously there was the drift hack and it seemed a few months ago we were and once again, you know, in hindsight, these are the narratives, but you know, DeFi was dead, [snorts] right? Because uh you know, the smart contracts worked as they should, but if you're taking collateral that can break down in another platform entirely and it blows you up and you need a bailout, what is DeFi? But it seems like that once again was kind of a bottom thing. That was like the worst case scenario played out and there was not much lower to go. I find it really interesting that these things are performing well because doesn't seem like they would have.

[00:13:28]>> Yeah, I absolutely agree with that.

[00:13:29]Well, the DeFi community did a good job of bailing out a but I think what people are realizing is they've made two fundamental miscalculations about the space, maybe three. Um the first is the market it's going after. If you think DeFi is servicing the crypto market, that's a $2 trillion market. But it turns out that DeFi is going to service crypto equities and bonds, that's a $300 trillion market. So you went from two trillion to $300 trillion in TAM. That's 150x error. So I think that alone is causing people to rewrite that, right?

[00:14:02]You're now lending tokenized stocks on Morpho. That's not something we were talking about a year ago. It was a fantasy. So I think people are rerating them because they're rerating the size of the TAM and then at the same time they're rerating the the sort of value capture because whether it's unis swap throwing the fee switch or a I forget will win or whatever their their program is or hyperlquid with a much better token economic function. People are seeing that these chains have a way of of actually taking value. And when you combine like rerating the market up 150x and then rerating value capture from zero to something uh that's I think why you're getting sort of a phase shift in these assets which which got down to really small valuations right a you know I think it was sub two billion or something like it was really small and I think people are realizing that they need to adjust to this crypto takes the entire capital market phase in which case DeFi is probably a lot bigger than it looks today.

[00:15:05]>> Yeah, I think as I'm hearing you talk through it, it seems that the DeFi that was cryptonative may have actually died and then rising from the ashes is a completely new DeFi and that's what people are pricing. So, DeFi, like I go take a loan against some random collateral to go live my life. That was DeFi and that kind of died. But Standard Chartered had those wildly huge predictions for unis swap, you know, and uh it was hype in no a and unis swap, right? Like $50,000 a or something. I don't remember what it was, but it was based on exactly what you're saying. I thought it was a bit of an absurd way to extrapolate price, but if TAM, you know, or TVL grows to trillions because of tokenized stocks, then the price goes up by the same multiple. I I don't necessarily agree that that happens with the tokens once again, but are saying the same thing where you can't look at DeFi as me going to take a loan now. It's what am I going to do with my entire stock portfolio?

[00:16:04]>> Yeah, that is exactly right. And and and I love Jeff Kendrick at at Standard Chartered. Those were very aggressive price targets. I'm not sure I get all the way there. Uh but I do think that's it. Yes, the old DeFi vision is dead.

[00:16:18]>> Defi has had a strange few months. the protocols that were supposed to be dead are leading the market. Hyperlid is the most visible example, but Hogan is making a broader point that goes beyond any single asset. His argument is that the DeFi market is being rerated at a fundamental level and the reason is a mistake in how people calculated the size of the opportunity. If DeFi is only serving the crypto market, the total addressable market is roughly $2 trillion. That is the number most people have been working with and it makes DeFi look like a niche product serving a niche ecosystem. But if DeFi is actually going to serve as crypto alongside traditional equities and bonds, the math changes completely. You are now talking about something closer to 300 trillion in addressable assets. That is not a small rounding error. That is a 150 times expansion of what the market is actually competing for. You can already see that transition happening. Tokenized stocks are being lent on lending protocols. UniS swap is being deployed on Robin Hood's new layer 2 chain. Black Rockck is working with onchain infrastructure. These are not proofs of concept. They are live products in real markets. The second part of the repricing is value capture. For a long time, the criticism of DeFi tokens was that the protocols generated enormous volume, but the tokens did not capture much of that value. Fee switches were delayed or never flipped. Token economics looked like governance theater more than real equity. That is also changing. Protocols are now actively routing value back to token holders in ways that are transparent, verifiable, and growing. Put those two things together, a market that is 150 times larger than anyone was modeling and protocol tokens that are now genuinely capturing value from that market and a dramatic repricing is not surprising. It is the logical outcome. Hogan frames Robin Hood's chain as an important signal here. Not because it will be the dominant chain in 10 years, but because it represents traditional finance actively choosing to build on blockchain rails rather than around them. When a company with tens of millions of retail customers launches its own layer 2 and integrates DeFi protocols directly, it is not dabbling. It is committing. And every brokerage watching that move is now in a board meeting trying to figure out what their response needs to be. The old version of DeFi, where the pitch was taking a loan against speculative collateral to fund a leverage lifestyle, is mostly gone. The new version, where the pitch is that every financial asset in the world can move, settle, and earn yield on chain is just getting started.

[00:18:36]the market is beginning to price that difference.

[00:18:39]>> Going back to who's going to be the next buyer, I don't know if you saw this story, but uh Bitcoin XRP draw Japanese firms as weekend drives treasury diversification. So, they've basically seen a doubling in SBIVC trade of, you know, corporate and large accounts who are buying Bitcoin and apparently XRP because very transparently because the yen is so weak and that's where they're going to preserve value and store value, which I just saw this headline came out of nowhere. Uh it's like hey that's what that's what we've been saying about Bitcoin.

[00:19:08]>> It's a beautiful thing. I still think that story is very intact. Um you know that story uh gets papered over during uh during bare markets. Uh people aren't willing to advance it. But you know the the probability that most fiat currencies lose value over time seems to be 100%. And the probability that these assets which are increasingly accepted from a regulatory perspective increasingly have better liquidity are increasingly accessible gain some portion of the flows is probably very high and it doesn't have to be that much of the flows to drive interest. It's interesting that it's XRP but the world is a you know a wide space. Um so I I think that's a good example of you know this hasn't slowed down. We continue to do consultations with central banks and sovereign wealth funds who are interested in diversifying their treasuries. So, so this you know underneath the surface this is all continuing to happen.

[00:20:05]>> Yeah. I mean it says I'm reading it says that weekend pushes them to diversify corporate treasuries as a crypto exchange registered accounts past 2 million. But interestingly here it says that uh the crypto arm of financial group blah blah blah uh they've grown as the weekend drives firms to spread reserves beyond cash with added demand from companies that hand out Bitcoin or XRP through shareholder perk programs.

[00:20:31]So >> wow that's an interesting nuance because I did not know that there were companies that hand out Bitcoin and XRP through shareholder perk programs.

[00:20:38]>> I did not either but uh but it makes sense to me, right? These are these are tribal communities. you can tap into through doing something like that. Um, I think that's really interesting. It's also worth noting, I say this all the time and I can't seem to get it across, but if you think about like this bare market versus a bare market four years ago, the people making those sorts of decisions at those firms are four years further into their career. They're probably higher up their firms. That demographic like aging into positions of power makes these sorts of decisions easier for these companies. And I think is actually sort of an under reportported thing that's happening in crypto.

[00:21:17]>> Is this like kind of a little uh you know bull trap in the middle of a bare market or uh you know what does it mean?

[00:21:23]>> I think it's just a choppy summer. I have the the Green Day song uh wake me up when September ends in my head. Um look look you still have uncertainty in the market right? You still have the clarity act uncertainty which is a big sort of damocles hanging over crypto.

[00:21:42]uh you still have financial adviserss and institutions who I think are the next primary buyer basically take most of the summer off so they're unlikely to show up with you know $20 billion of Bitcoin uh particularly ahead of the Clarity Act and uh it just and you have Iran you have figuring out who Kevin Worsh is and how he views the market you just have a lot of uncertainty so my base case and I could very well be wrong is it's a it's a choppy summer. I think as we get into the historically good months of crypto, which you know start in October and accelerate through November, uh there's a lot of reason to imagine we might be on the other side of that train, that we might have the Clarity Act uncertainty behind us, that we might have figured out Kevin Worsh, uh that we might have squeezed the last bit of leverage out of the system, that this DeFi renaissance might be actually in full bloom, uh that the stable coin rules, which are being finalized right now, will start to go into effect.

[00:22:42]There's a lot of things lining up for the fourth quarter in particular, maybe the late part of the third quarter. I would love to say we go straight up from here. Maybe we do. We've shown a lot of resilience. Um, but I personally think the market's going to want to churn through that uncertainty for a little while and then I think it'll be a great end of the year. I do think the next cycle, you can see what it is. It's institutional adoption of crypto. It's uh everyone building their own chain.

[00:23:09]It's DeFi conquering all assets. It's all assets moving into the crypto and blockchain ecosystem and everything that uh means for the growth of this ecosystem. I think it's a really good narrative for that next cycle. But I think we have to get probably through a little bit of uncertainty over the summer uh before we get there. Again, I hope I'm wrong, but that's that's my base case.

[00:23:31]>> The Japanese corporate treasury story is easy to miss because it arrives without a dramatic headline. No single company announcing a billion dollar Bitcoin purchase. No ETF approval generating wall-to-wall coverage. Just a quiet doubling of registered accounts at a major crypto exchange driven by corporate buyers who are moving out of yen and into Bitcoin and other digital assets because their domestic currency keeps losing value. Hogan's point about this is bigger than it sounds. The thesis that Bitcoin benefits from fiat debasement has been around for years.

[00:24:00]During bare markets, it gets dismissed as cope. But the behavior of Japanese corporates right now is the thesis working in real time. Companies with excess cash that are watching their reserves shrink in real terms are making a rational decision. Some of them are doing it through shareholder reward programs, which means their customers and investors are getting exposure to Bitcoin simply by participating in a company's loyalty structure. That kind of embedded adoption does not show up in ETF flowcharts, but it is real demand.

[00:24:28]The detail that matters most in Hogan's broader outlook is the demographic one.

[00:24:32]The professionals who entered crypto in 2017 and 2018 are now eight years further into their careers. They are moving into senior positions. In another decade, they will be running institutions. They do not need to be convinced that Bitcoin is legitimate.

[00:24:46]They already know it is. Their hesitation has never been philosophical.

[00:24:49]It has been procedural, waiting for compliance frameworks, regulatory clarity, and enough [music] institutional precedent to act without career risk. Those conditions are falling into place one by one. The Clarity Act may or may not pass this year, but the regulatory direction is clear. Cryptofriendly leadership at the agencies responsible for oversight changes what's practically possible for institutions that have been waiting on the sidelines. Hogan's base case for the rest of the year is not a straight lineup. He expects a choppy summer.

[00:25:15]While uncertainty around regulation, the Fed, and broader macro works through the system, but his read on Q4 and beyond is different. By the time the historically strong months for Bitcoin arrive, the Clarity Act situation should be more resolved. The institutional allocation process that has been running quietly in the background should start showing up in flows and the DeFi repricing that is just getting started should be in fuller bloom. The setup he's describing is not about a new speculative mania driven by retail momentum. It's about the slow durable accumulation of a new buyer class combined with a structural reduction in the supply willing to meet that demand. Those two forces do not make noise when they are building. They just make price. What Matt Hogan laid out across this conversation is a case for Bitcoin and the broader crypto market that does not depend on excitement or narrative momentum to hold together. The outflow data from the second quarter showed capitulation.

[00:26:03]Capitulation marks latestage bare markets more often than it marks the beginning of new ones. The DeFi renaissance is being driven by a fundamental re-evaluation of the market being addressed, not hype. The institutional buyer pipeline is deeper and more patient than anything that has come before it. And the demographic shift happening inside major financial institutions is slow, quiet, and structurally irreversible. None of this means Q3 is going to be [music] easy.

[00:26:27]The uncertainty is real, and Hogan is honest about that. But the architecture being built inside the price is more durable than this moment suggests. The forces are aligned. They just need time to show up in the numbers. See you in the next