Bitwise’s head of investment believes that once regulatory uncertainties are cleared up by United States regulators, the crypto space could see a surge of interest from the financial advisory industry, potentially tapping into trillions of dollars. According to Bitwise’s chief investment officer, Matt Hougan, the primary reason financial advisors have been hesitant to delve into crypto over the past five years is due to regulatory ambiguity, as outlined in a post on June 4.
Hougan is optimistic that the U.S. is making progress towards establishing regulatory clarity, which could pave the way for the $20 trillion financial advisory industry to embrace crypto. He envisions a scenario where if Wall Street as a whole were to accept crypto as a normal part of the market, the impact would be even greater than when BlackRock made its move into the crypto space.
Hougan highlighted a significant turning point last month when Democrats joined forces to repeal Staff Accounting Bulletin 121 and when the House approved the Financial Innovation and Technology for the 21st Century Act (FIT21), which was seen as a victory by many in the crypto industry. Additionally, the Securities and Exchange Commission’s approval of spot Ether (ETH) exchange-traded funds (ETFs) on May 23, following months of speculation, marked another positive development.
Despite President Joe Biden’s veto of the SAB 121 repeal, indicating that there is still a long road ahead for crypto, Hougan remains optimistic. He believes that there is untapped potential for “alpha” in the crypto market, which has largely gone unnoticed by those outside the industry.
While Hougan acknowledges that there have been setbacks, such as the uncertainty surrounding the fate of FIT21 in the Senate and the pending launch of spot Ether ETFs, he remains hopeful that with the right policies in place, the crypto market could reach new heights. Hougan emphasized the need for a better understanding of the implications of regulatory shifts in Washington D.C., suggesting that this awareness could propel the crypto market to new all-time highs.
As the industry awaits further developments and changes in policies, Hougan remains confident that the crypto market is poised for growth, with the potential to attract more mainstream interest in the future.