Bitwise CIO Says Crypto Index Funds Will Be “A Big Deal,” Position Investors For 10X Growth

Bitwise Chief Investment Officer (CIO) Matt Hougan says that crypto index funds, which give investors the opportunity to buy into a basket of assets, will be “a big deal” in 2026.

“The market is getting more complex and the use cases are multiplying,” Hougan said in a recent note to investors, adding that crypto index funds reduce the risk that investors will miss out on the market’s 10X growth potential.

Industry Still Divided Over Crypto’s Future

Hougan said that it is difficult to say what the future will look like for the digital asset space.

To illustrate his point, he highlighted the debate around Solana versus Ethereum. He noted that on one hand, members of the crypto community say that Ethereum is better and that it will dominate the market. On the other hand, there are those that say Solana is poised to overtake Ethereum in the long term. 

Hougan also mentioned the argument by some in the crypto community that Bitcoin is the only digital asset that matters. 

He said that even with his extensive network in the digital asset space, which includes VCs, founders, researchers and foundations who all regularly discuss ideas with him, he still cannot confidently say “how things will turn out.”

“At this stage of crypto’s development, I’d argue it’s unknowable,” he added.  

Hougan said that a combination of factors will determine the outcome of the crypto market. This includes regulation, execution, macro conditions, the actions of key individuals, luck, and a hundred other variables,” he said. 

“People who claim certainty are, I think, fooling themselves,” he argued. 

Crypto Index Funds The Only Way To Capture All Of The Market’s Growth, Hougan Says

Hougan predicted that the crypto market as a whole could grow 10-20X “over the next decade without breaking a sweat.”

He added that his “highest-conviction bet in crypto” is that the digital asset market “will be far more important in 10 years than it is today.” 

Hougan then mentioned a recent interview that US Securities and Exchange Commission (SEC) Chair Paul Atkins had with Fox Business. In the interview, Atkins said he expects all US equity markets to move onchain “in a couple of years.” 

That translates to approximately $68 trillion in equities, Hougan said, noting that the current tokenized stocks market has a combined capitalization of just $670 million. 

Tokenized stock market overview (Source: RWA.xyz)

However, he said that it will be difficult for investors to spot the opportunities in the market that will post substantial growth and lead to just as large gains. 

“Imagine correctly calling a market that goes up 100,000x—and still underperforming because you backed the wrong horse,” he said. 

Due to the complexity in the space, Hougan says that his investment approach for crypto is to “buy the market.” To do this, he says he invests in market-cap weighted crypto index funds. The Bitwise CIO then makes “individual bets around the edges.” 

He acknowledged that crypto index funds might not be the right fit for every investor. However, he says that for many, including himself, they are a “great place to start.”