Compiled & Edited by: Odaily TechFlow
Guests: Matt Hougan (Chief Investment Officer at Bitwise), Ryan Rasmussen (Head of Research at Bitwise)
Host: The Rollup Anchor
Podcast Source: The Rollup
Original Title: Bitwise CIO & Research Head: Why Institutions Are Buying Ethereum Now (Majors vs Apps)
Air Date: August 12, 2026
Note: The guests' firm, Bitwise, operates multiple crypto ETF products, and their views may carry a structural bullish bias. This article preserves their original statements and does not constitute investment advice.
Key Takeaways
At the time of this recording, Bitcoin was approximately $65,000, down more than half from its October high. But the two Bitwise executives saw a different picture: throughout the summer, Saylor (founder of Strategy) was selling coins, a cold wallet theft of over $100 million occurred, and the Clarity Act stalled in the Senate—yet Bitcoin didn't drop at all. They interpret this phenomenon as a bottom signal: those who could sell have already sold, leaving only the "ride or die" long-term holders. Meanwhile, the real big buyers—Wall Street wealth management platforms—have just completed a two-year education period and are about to begin allocating.
The two guests offered a clear bifurcation thesis: the upcoming bull market will be split into two distinct markets. Institutional capital will buy mainstream assets like Bitcoin and Ethereum that can absorb large sums, while on-chain native capital will bet on DeFi applications with real revenue (Hyperliquid, Uniswap, Aave, Morpho, etc.). They specifically emphasized that the biggest catalyst isn't within the crypto community's sightline, but rather in the model portfolios of four wealth platforms—Morgan Stanley, Wells Fargo, UBS, and BofA Merrill Lynch—which collectively manage approximately $20 trillion in assets. If just 1% to 2% is allocated to crypto, that's hundreds of billions in sustained inflows. As of compilation time (August 13), ETH is around $1,900, spot ETFs have seen net inflows for five consecutive weeks, with approximately $245 million flowing in over the most recent week—the strongest in nearly four months. The SEC is scheduled to review the Reg Crypto proposal on August 14, meaning the regulatory variable discussed in this episode is materializing right now.
Key Insights Summary
On Market Bottom
- "When the market becomes completely indifferent to bad news, that's often when a true bottom forms." (Matt)
- "This drawdown from the high is 55%, not the 70% to 80% we've seen in the past. Cycles are compressing, and volatility is declining." (Ryan)
- "Bear markets always last longer than you think, but you could wake up one day in a full-blown bull market." (Matt)
On Institutional Buying
- "The typical path for our clients is eight meetings before they start allocating, and we might only see them once a year—that's a two-year education process." (Matt)
- "The question they're asking is no longer 'should we invest in crypto' but 'when should we invest in crypto.'" (Ryan)
- "They look at 3 to 5 years, 10 years—not 3 to 5 days. With a new type of investor in the market, volatility naturally comes down." (Matt)
On the Bifurcated Bull Market
- "Bitcoin will increasingly resemble gold, while Ethereum and Solana will look more like software company stocks. They should have different drivers." (Ryan)
- "A $2.5 billion market cap Uniswap can't accommodate institutional money—the liquidity scale simply doesn't match." (Matt)
- "DeFi will become in the next bull run what we thought it would be in 2021—the regulatory shackles have been removed." (Ryan)
On Regulation and Macro
- "The first draft rules of Reg Crypto are coming soon, allowing new projects to raise funds without triggering SEC registration, then gradually move toward decentralization. Washington moves slower than crypto is used to, but this is real." (Matt)
- "The US government says it will borrow $600 billion in Q4—bigger than the GFC rescue package for banks. This long-term trend won't stop." (Ryan)
1. The Market Is Indifferent to Bad News—This Could Be the Bottom
Host: The market is waiting for one final summer dip and an October bottom. What do you make of that narrative?
Matt said he posted a Buzz Lightyear meme with the collective sentiment of the crypto community: one more washout in the summer, a final dip, then an October bottom followed by a steady rise—everyone is planning to enter at the end of October. But the market he sees looks different.
"Over the past two months, my strongest impression is that the market has completely stopped reacting to bad news. Saylor is selling Bitcoin—Bitcoin doesn't care. A $100 million cold wallet theft—Bitcoin doesn't care. The Clarity Act falls through—Bitcoin still doesn't care. When the market becomes immune to bad news, that's often when a true bottom forms."
Ryan added: In past cycles, the biggest gains after a bear market often came in the very first few days, and those trying to time the perfect bottom missed the best days. Rather than waiting for Bitcoin at $50,000-something, it's worth accepting the possibility that most of this correction is already behind us.
2. The Four-Year Cycle Is Compressing Into a New Shape
Host: They say every four-year cycle has one year up and one year down. Is that changing?
Ryan's observation is that the cycle's "amplitude" is compressing. This drawdown from the high is 55%, compared to the historical 70% to 80%. The multiple of the last run to new highs was also far less dramatic than in the past. Calendar year 2025 was itself a down year—the old "three years up, one year down" pattern no longer fits.
The reason is simple: the buyers have changed. Four years ago, retail investors were entering. Now, Bitwise deals with institutions, corporations, sovereign wealth funds, and family offices on a daily basis. Their holding periods differ, their decision-making cadence differs, and this market is far larger and more liquid than before. The cycle still exists, but its shape will inevitably change.
Matt said bear markets always last a bit longer than expected, but "it's easy to get back to $100K within months under the right conditions." He repeatedly used one word to describe the upcoming bull market: a slow grind. Slower, more fundamentals-driven, more institutionalized—climbing steadily.
