Matt Hougan from Bitwise identifies an important market opportunity in the divergent movements between professional institutions that buy and retail investors that sell crypto assets.
Hougan presented a “fascinating dichotomy” in his clients’ Feb. 12 note which showed institutional investors keeping positive attitudes while retail users demonstrate doubting attitudes.
Hougan linked the rising interest from financial institutions to the arrival of Wall Street crypto exchange-traded funds (ETFs). Financial investors have sent billions towards Bitcoin and Ethereum products through ETFs that show signs of future approvals from the U.S. Securities and Exchange Commission.
New Crypto Rules Coming
Political developments in Washington DC are anticipated to shape the industry according to suggestions by Hougan. The recent return of former President Donald Trump to office has reduced the opposition toward digital assets shown by lawmakers in Capitol Hill.
Legislators have proposed bills that define stablecoins and Congressional subcommittees from both chambers have initiated cooperative groups for developing crypto regulations.
The retail public’s negative outlook towards crypto adoption does not deter Hougan because he foresees positive influences from sovereign states. According to him the altcoin sector currently stands beyond any historical levels based on Bitwise’s on-chain sentiment data that indicates retail market pessimism.
Bitcoin maintained high records which attracted retail attention but they complained about weak performance from altcoins according to Hougan. Altcoin markets have missed out on repeating the previous two major market forces: the 2017 initial coin offering (ICO) expansion and the 2021 decentralized finance (DeFi) boom.
Solana along with other networks has benefited from meme coin market successes however Hougan predicts new U.S. regulatory standards will trigger a fundamental altcoin focus. The future expansion of institutional blockchain adoption coupled with DeFi adoption will result from his prediction.
According to Hougan predictions the transformation in altcoins will become unmistakable within the following one to two years. The market will experience a major shift which will become evidently clear by 2025 or 2026 according to Hougan’s assessment.
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