Institutional Investors Expected to Bring $1 Trillion Bitcoin Inflow through ETFs, Forecasts Bitwise CIO
Matthew Hougan, the chief investment officer of Bitwise, predicts that institutional investors will invest up to $1 trillion in Bitcoin through exchange-traded funds (ETFs) as they gradually enter the cryptocurrency market. In a memo to investment experts, Hougan addressed concerns about Bitcoin’s price volatility and advised taking a long-term perspective. Despite the short-term fluctuations, he highlighted important upcoming events such as the Bitcoin halving and the potential approval of spot Bitcoin ETFs by major platforms like Morgan Stanley and Wells Fargo. Hougan emphasized the need for thorough due diligence processes by investment committees and consultants before committing to Bitcoin investments. While waiting for these developments, he expects Bitcoin’s price to move sideways in response to minor sentiment shifts. Nonetheless, Hougan remains optimistic about Bitcoin’s future, citing a strong bull market with a nearly 300% increase over the past 15 months and compelling reasons for continued growth.
Hougan believes that the approval of spot Bitcoin ETFs in January has opened the crypto market to investment professionals, signaling the beginning of interest from professionals managing trillions of dollars. However, he believes that it will take years for this interest to fully materialize. He also noted that the $12 billion influx into ETFs since their launch is the most successful ETF debut to date. Nevertheless, he anticipates that if global wealth managers allocate just 1% of their portfolios to Bitcoin, it could result in $1 trillion in inflows, making the initial $12 billion seem insignificant.
In March, Hougan suggested that spot Ethereum ETFs could attract more assets if launched after May. However, considering a more cautious outlook for a May debut, he proposed a December launch as a more beneficial option. This delay would allow Wall Street and traditional finance sectors more time to understand the complexities of cryptocurrency, particularly Bitcoin. Hougan estimated that it would take eight to nine months for Wall Street to adjust to Bitcoin before considering the launch of another ETF.
