Bitwise's Matt Hougan and Ryan Rasmussen on whether Bitcoin has bottomed

Transcript

And if you zoom out 10 years from now, the long-term drivers behind Bitcoin are not is strategy going to buy or sell Bitcoin. They're will governments continue to debase currencies, will this debt issue, which people seem to not talk about as much now as it did last year, but still is very real, will this debt issue continue to exist 10 years from now? Will there be demand for fixed supply hard assets like gold, like Bitcoin? >> What's up everybody? It's LG Duquette here and welcome to the Milk Road Show, the daily crypto show that's starting to feel like the crypto market is a big gray whale relentlessly trying to beat itself. Today is June 24th, 2026. We

can't stop talking about the bottom for Bitcoin and it's even more relevant on a day like today when it's teetering on that 60K line yet again. But our guests today share different perspective that's that although there are diverging opinions on where it finally lands that everyone, literally everyone in the industry, agrees its long-term trajectory is up. We'll talk about all that plus a dive into crypto equities and tokenization on Solana with Matt and Ryan from Bitwise. Today's episode is brought to you by Bitget Stocks 2.0 with real liquidity, real dividends, and Nexo, earn interest, borrow, and trade crypto. Matt, Ryan, welcome back, guys.

>> It's great to be here. Love it. >> Okay, so if you are if you're if you're a gray whale right now, what are you trying to do if you're the crypto market? >> [laughter] >> Just trying to get >> Get ashore and and end >> End the suffering. >> [laughter] >> Yeah. >> Crawl my way to the Federal Reserve and and tell them to to cut rates. >> [laughter] >> Is that Ryan, is that is that really what you think would save the market at this point? Is that you would just need you just need certainty on rates? Is that really what you think is kind of hanging over all this? >> I think it's a really big factor, particularly for crypto and I would love to get to get into it, but I do think that's a really big factor.

>> Mhm. >> Mhm. >> I I think I take I may take partly the other side on that. I know there's a big Kevin Warsh freak out about how he killed the debasement trade. I think that's true from a short-term perspective. But, I don't think interest rates really matter that much at all. I actually think it's a false god that we're worshipping from prior cycles. And um I don't think that's the driver. I think it's the 4-year cycle that's still in charge. And I think we're going to be just fine. >> Man, you think it Okay. So, is there any Matt, I've asked you this like 100 times, but is there anything What would invalidate the 4-year cycle at this point?

Because it does I I I agree with you. It is in charge. And if you see a bottom in Q3, then it's then that's it, right? Like that's that we continue to believe that. Is that Is that even possible at this point? Like is is that still what you think is going to happen? >> Q3 Q4. I mean, if Bitcoin doesn't go up next year, I think you have to believe it's in force until it's no longer in force. And it appears to be in force. There's a reason to believe we're moving through the sort of liquidity cycles, etc. I think we'll get out to the other side. Specific to interest rates, the reason I think it's a false god is we're talking about tinkering with interest rates. 25 basis points up, 25 basis points down.

Who cares? I've said it on the show before. We've We've been used to this cycle of interest rates that swing from 5% to 0 to 5% to 0. That's what we've had since Bitcoin was created. And I think what we're talking about now is interest rates that hover around here for the foreseeable future. That's why I don't think it's actually as important. We've just been taught it's important. I actually think Fed balance sheet and Treasury balance sheet are more important than interest rates uh specifically. But, Ryan Ryan may may take the other side. He may well be right.

>> Yeah, well, no, I think I am right uh for the record there. Uh but, no, I was just looking at a Look, I I there's definitely some truth to that. I think that in expectations around the direction of interest rates is something that investors think about. Particularly younger investors who are debating where to allocate capital, perhaps they are trying to save up money to buy a house and trying to decide do they buy a house now or do they buy a house later? What should I invest in? Like all of this I think is part of this capital rotation and what sucked liquidity and euphoria out of crypto. It's not the only factor, but I think it's part of it. I was just looking at a historical uh chart of interest rate expectations heading into 2026. Right around

Thanksgiving last year, the overwhelming expectations were for several rate cuts uh in 2026. There was There was a 2% chance that uh the market was pricing in that interest rates would be down at the 2% range, right? And so I mean there was just this massive shift that's happened even up the FOMC meeting last week where now the expectations are several rate hikes. And I just can't I can't grapple with that not having an impact on investor sentiment, allocations, and how and how the markets are uh thinking about it, particularly in crypto. Now, equities obviously have shaken that off entirely and I could understand the the argument that it

makes zero sense that it would impact crypto and and and uh not equities, but I do think it plays a role here and uh at least is a you know, somewhat material driver of of what's happening. >> Guys, listen, we are at a very crucial point in time right now. AI stocks have ripped, they're going to keep ripping. Our analysts on the AI side are up like literally 100% or more on quite a few calls. And crypto is about to boom again, or at least it feels that way. If you want all the inside on what we're buying, what our analysts are doing, what's on their watch list, all of that is in Milk Road Pro. So join at the link below.

>> Mhm. Mhm. Do you think that Ryan, just expand on that. Do you feel like that has cancelled out the potential rebound or pump that would have come and even if this is equities market only now [snorts] that the Iran conflict it feels more resolved than it was in some way. It just it feels more mute now, let's say. >> Yeah, I mean I don't I don't know if it does. I think that you know, the the I I forget who put it out there, but there's some thing that says like a deal's been reached 50 plus times is something that Trump said and so I don't know if it feels resolved. I think we're used to it and it's the new normal is that you're going

to have elevated oil prices and that you're going to have this will they won't they happening for who knows how long. Of course, I believe it will get resolved, but but the will they won't they is exactly what's what's causing oil prices to stay somewhat elevated, which is in leading to fears around high inflation, which is leading to likelihood of rate hikes instead of rate cuts. I think it's all connected. People talk about Bitcoin being a hedge against geopolitical conflict, but certain types of geopolitical conflict weigh more on the market in my opinion, particularly the Bitcoin market than others and I think this is one where you can draw a line between the conflict in Iran raising oil

prices, inflation fears, likelihood of interest rate hikes. And I think that line, whether interest rate hikes happen or not cuz I actually don't believe they're going to happen, but the market's pricing in that they're going to happen. I think that the uncertainty is playing a bigger role here than than some of my colleagues believe. >> What do you think what do you think crypto's pricing in right now? >> Yeah, I think crypto's pricing the same as the rest of the market, likelihood for rate hikes and pain. I just don't believe that we're going to see rate hikes personally. I think that the the base case is that at least mine personally is that rates stay flat through the end of the year and that we're probably in this moment of panic around rates, but we'll see.

>> How about you, Matt? >> [clears throat] >> I think crypto is pricing in the fact that no one cares about it. Instead, people care about AI and robotics and GLP-1 drugs. Uh and I think that's uh sucking all the attention out of the room and all the capital out of room. And so people haven't taken the time to re-underwrite what's happening in crypto, uh which is that we are actually and in fact recreating how financial markets work uh in a very real way. And I think that's going to be rewarded by the market long-term. But I think it's mostly this attention-based thing that is going on and we need to get through that and then re-underwrite the new sort of green shoot cycle that I can see happening underneath the surface in

crypto land. Um I think that's the big driver. >> Yeah. >> We're in the middle of Go ahead, Ryan. >> I was just going to say I I agree with that. Uh but I I would say there's two interesting things uh within that that that I would share. You know, I would love to hear Matt's view on this, but him and I both spend a lot of time talking to traditional investors, wealth managers, financial advisors, etc. And what's interesting right now is that it is both true that they are extremely focused on equities and upcoming IPOs and AI and all of those things, but they're also still asking questions about Bitcoin and about crypto. Some of these these conferences that we go to, the way that they're structured, maybe

maybe the listeners will find this interesting if they haven't been to uh one of these kind of like trad-fi or wealth management or allocator conferences is is like you you have these round table lunches that happen or just round tables in general where the wealth managers opt in to the different conversations they want to be a part of. And then you have 30-60 minute conversations, right? And you can imagine Bitwise is at one and then uh perhaps Arc is at another table, and then there's like an AI specialist firm in another, and then a private credit table, right? And the the financial advisors opt in to which table they want to sit at and have these discussions around. It's not like our table's empty. I was at one of these 2 weeks ago, and our table was full, and people were highly engaged. They weren't

saying, "Isn't this just going to go to zero?" They were asking questions around, "Talk to me about how there's only 21 million that exist. What's going to happen with quantum? You know, which ETFs should we be looking at? How are things like crypto equities and Bitcoin miners performing?" Like they're still engaged, and I think that's interesting cuz the prices are where they're at, and there's so much pressure uh as humans to kind of look at the shiny thing, but they're actually looking at this this thing that's quite dirty. So, I think that's uh interesting. The other point thing that I would note is that this has happened time and time again, where crypto's been the the outcast uh thing that nobody wants to talk about, nobody's interested in, and then it's turned back around, momentum shifted in its favor, and it becomes the belle of the ball, and

everyone comes in. So, I think that we're in this cycle, but I do think that it's interesting that people are still engaged and getting educated and working through how should I allocate when prices are at these levels. >> Feels like we're just in the we we've entered post-COVID like the vibe trading economy, right? Where it's just like and it's and I think that's led by crypto, right? Is that it's like, "Hey, listen, you could you could come back every 2 or 3 years and make a ton of money on crypto as all the stuff pumps, all these new ideas, all these tokens." And then you can leave, and now when you leave in between those cycles, there's other cool stuff that pumps the same way, right?

[laughter] And it's like, "Now we'll just pump every sector one by one in these kind of crazy" No, but really, right? And it's like, you know, Matt, you nailed it with like GLP-1 drugs. We literally did an AI show on that yesterday, right? And it's just like, "Well, you know, where's all that Micron? Everyone's going to take profits on Micron. Where are you going to go?" Oh, I know. Let's go buy, you know, whatever PIMs or something like that. Like some other thing that has this Oh, it's going to have all these deals and all this research and blah blah blah blah blah, right? It's just like and that's that's the reality, right? Of of of the modern economy is that, you know, and it feels like at least from doing this show and the AI show, it's like, yeah, a lot of that will rotate back to

crypto. We don't know when. But at some point, because there's a lot of great fundamentals being built right now, right? And that that's that's kind of what you guys are telling me as well a little bit, too, right? Is that it's it's just it's just it's not just crypto cyclical. It's just like the whole liquidity like the just like liquidity for equities and everything. It's like, yep, crypto is on the list of things that it will come to now. Um but it's not the only thing. >> I think that's exactly right. And the other thing to remember is that these attitudes shift so quickly. Like even within crypto, a week ago, we were all feeling pretty positive. And then a week before that, the world was ending. And then a few months before that, we were rallying cuz we were this new hedge when the Iran war started. I mean, these

narratives can shift very quickly. I don't think we're that far from investors rotating into some aspect of crypto, whether it's Bitcoin or whether it's stablecoin and tokenization-related plays, or whether it's crypto reinventing parts of the financial stack. I agree with you, LG. It's like it's now part of this continuum of assets that get attention periodically. And um yeah, I mean, I feel I feel confident it'll it'll rotate back. And in the meantime, we're making fundamental progress, which is exciting to see.

>> We're talking about this a little bit before, guys, but to me and you know, I was expressing this to you guys that doing this show and consuming a lot of the sentiment, that the despite rates and AI trade and wars and all that kind of stuff, it does feel like um uh strategy Michael Saylor is kind of like one of the big factors that kind of hangs in the balance of Bitcoin, right? And that's something where um to me it feels like it when all these, you know, kind of what you're talking about, Matt, where it's like, yep, that the crypto's going to crash, cash is bid. Like it could be now, it could be in a month, it could be in a year, we don't know, but it will at some point.

To me, that feels like one of the big glaring like, hey, that's we don't know what's happening with that because it's not going exactly according to plan or it's not going in a way that a lot of the market fully understands. Let's put it, right? That they don't really quite get what's happening there and they they just see a mix of weird headlines, selling buying selling buying Bitcoin. Um how how big of a factor do you think that is, especially from your perspective talking to a lot of the institutional players? >> Institutions raise it. It's not the primary one. I'd actually argue that they have more concern about quantum than they do about strategy. They have more questions about quantum than they do about strategy. But strategy comes up. My take on it is that its centrality will fade over time. And actually, we've seen this

in the past with other crypto boogeyman. Do you remember when we all worried about the Mount Gox distributions and they were this massive tidal wave hanging over our head? And then we all worried about GBTC and it was this massive tidal wave hanging over our head. What happens when that trade stops? The interesting thing about both of those, which is actually instructive here, is what happened was not an explosion or a blowup. What happened in both of those cases is the market priced them in and they faded to some version of irrelevancy. It's still true on the edges that we think about Mount Gox distribution. It's still true on the edges that money is rotating out of GBTC into other avenues and those sorts of

things. And as price comes down and the capital gains overhang comes down, maybe more of that unlocks. All of those things are still true, but these like uh central focus boogeyman, people always imagine they end in a supernova. And actually, what they end in is a whimper and they just become part of the firmament uh that is crypto. And I think that's the future of strategy. Look, I think strategy will be around for a very long time. I think they'll be doing interesting things with Bitcoin for a very long time. I think investors will be deciding which part of their capital stack is most beneficial at different points for a very long time. I don't think they're going to blow up. I don't think they're going to buy another 800,000 Bitcoin, either. I just think that they are going to like sort of be a

part of the ecosystem in the same way GBTC is part of an ecosystem and Mt. Gox's distributions are part of the ecosystem. Those Again, [clears throat] they they they tend to fade not to explode. I think that will be true here, too. >> Brian, are you concerned? >> I'm not concerned. No, I'm actually not. I mean, we do get questions about it, certainly. I I was answering questions from a client yesterday around how we think about stretch and strategy. I will say that there's a lot of questions around specifically the fact they sold Bitcoin. Like people are hyper-focused on the fact that they sold 32 Bitcoin despite buying 4,000 Bitcoin like the following week, which I I think is indicative of how oversensitive people are to the news that strategy

sold or something. But if you look at the underlying impact on supply and demand there, it's still net positive for Bitcoin. And so, I just think that we'll work our way through these things. I agree. I don't I think strategy will be around for a long time. I find their capital stack extremely interesting. I also agree that at some point, and we've known this, at some point their buying of hundreds of thousands of Bitcoin is going to slow down. They're not going to buy I know I know Saylor says that if the price dropped, he would buy every Bitcoin he could. But like at some point, no one wants to own 30, 40, 50% of a market.

And so, I just think this was fate, and we will move to the next chapter, and it will play a role as a power in the Bitcoin market as a force in the Bitcoin market. But there are many other forces that are marching towards the future of Bitcoin and I believe they will be strong and if you zoom out 10 years from now, the long-term drivers behind Bitcoin are not is strategy going to buy or sell Bitcoin. There will governments continue to debase currencies. Will this debt issue, which people seem to not talk about as much now as it did last year, but still is very real. Will this debt issue continue

to exist 10 years from now? Will there be demand for fixed supply hard assets like gold, like Bitcoin? All of those things, I've I've never felt more confident the answer to those is yes and that's really the long-term thesis for Bitcoin. Anything else is short-term noise and that's why I think you see investors continue to step in and buy the these dips is because there are people that control a lot of capital who believe in that long-term thesis and are in the market for the long-term.

Short-term investors get washed out. Long-term investors have conviction in that thesis and I think are holding holding strong there. >> Everyone's tokenizing stocks these days, but almost nobody's doing it right. Thin liquidity, prices that drift from the real thing, dividends that just vanish. Bitget Stocks 2.0 is different. Real NASDAQ and New York Stock Exchange depth through licensed brokers. Prices mapped one-to-one, dividends paid to your account in real time, plus you get the lowest fees in the market at just .04%. And you can trade them like any other crypto as margin and earn in grid trading. Tokenized stocks finally done right. Head to milkroad.com/bitget to get started.

>> The way we build wealth is changing. [music] Stocks, savings accounts, real estate, that playbook is getting rewritten in real time. Nexo is the platform built for what's next. It's an all-in-one digital wealth platform where you can earn interest on your crypto, borrow against it without selling, and trade a wide [music] range of assets. All in one place with 24/7 support and institutional grade security. Oh, and by the way, [music] Nexo is back in the US with new US clients getting 30 days of wealth club premium [music] access. That means elevated interest rates, lower borrowing costs, and crypto cashback on trades. [music] Benefits usually reserved for loyalty program members.

Get started at milkroad.com/nexo. >> Matt, did he say Bitcoin at one point? >> I heard Bitcoin. Wait through that, right? No, that's an excellent point, Ryan. I think that that's I think that that's a really great way to zoom way out of of what's going on right now. Um and I think, you know, even kind of your point, Matt, looking for boogeymen. Uh you know, that's that's just what crypto winter is, man. Like it's just like that's we got nothing else, you know? Like there's no there's nowhere else to look. There's a couple green shoots, a couple alts, but it's like ultimately we're like, "Okay, who's doing this to us?" You know? And what what and and the big question, right?

And and unfortunately, this is this is one of the bigger questions that we we're circulating on the show. We've discussed discussed with you guys, and Matt, you wrote your your latest memo about on the Bitwise memo, um which are always fantastic for anyone who wants to check them out, is that there are varying opinions on where the bottom is even in even now, um both from a, you know, chart TA perspective, from a just general analytical perspective. Um tell me a little bit more about that about about your piece and and kind of who's giving those diverging opinions and and even what that means long term.

>> Yeah, it was a it was a fun piece to write. You know, I mean, I read a lot of crypto research, but one thing that happened was I got three notes from three of my favorite crypto research firms, all on the exact same topic, which is has Bitcoin bottomed. And they were uh Galaxy Digital, which I think is fantastic, uh NYDIG, and Standard Chartered. And the thing about getting all three of those in the same week is that they said all three possible answers, right? So, you had Galaxy Digital, which basically said no, Bitcoin hasn't bottomed. It looked at I think it was 12 or 11 different metrics that historically occur at Bitcoin bottoms, and only three had occurred, and it said we're going to 40K. Okay,

that's sad. Right? Then I got Nydig, and it looked at historical Bitcoin cycles and said they were like 90, 80, 75, we're at 50. And it was like maybe that pattern follows, maybe 50 is the bottom, or 50% down is the bottom, but actually they thought, you know, probably we probably go a little bit lower 50% to down to 50K or so. So, they were at the maybe level. We went Standard Chartered, which has been great, and actually took down their Bitcoin projections earlier this year. So, they're not Pollyanna, they they understand what's going on in the market. They said the bottom is in. 59K was it. We got past SpaceX. We have a turn on ETF flows, the bottom is in.

So, I have three of my favorite researchers asking if the bottom is in, and saying no, maybe, and yes. And if that doesn't capture the confusion that most investors feel, right, I don't know what is. But the thing that occurred to me as I read all those is that was only one way of looking at what they were saying. Actually, if you inverted their pieces, the thing that all of them said, but didn't headline their piece in, is that they all thought the bottom would come. So, they think the bottom will be in, but they don't think the top will be in.

They were all calling for a new cycle, where Bitcoin would hit this bottom and rally. None of them had given up. None of them were bearish. They all thought we were closer to the bottom than we were to the October top, and they all thought Bitcoin would go on to another bull cycle. And that's when it hit me that the relevant question is not where is the bottom? The relevant question is where is the top? If you think the top is not in in other words, you think Bitcoin is going to trade back above 125k and I I've told you before I think it's going to 1.3 million then who cares 50 40 60 whatever.

Of course I posted that on Twitter and Twitter was like you know, if you do the math from 40 to 1.3 million, >> [laughter] >> but that you know, that's not the point. The point is if it goes to $1 million you're not going to care if you bought at 40 50 or 60. So the far more important question than where is the bottom is where is the top and I think we don't as an industry focus enough on the question of where is the top and I think the top is substantially higher. So that was the core of what that piece tried to say. Mhm [clears throat] mhm mhm and that yeah, so I like that that's I think that's a really great way to to kind of summarize it. What do what do you what's your take on the bottom at this at this

current time Mac is different. I feel like we we always want to kind of get your update but out of these which ones which one did you feel which I mean these are these are three your favorite but which one which one's right most often? Well, I don't know about that. I mean I think 90 is probably the closest to right. Okay, I think I think Galaxy overfit you can't expect all 11 things to happen exactly in those Frameworks and Standard Chartered was maybe a little bit early calling the ETF turn in flows and so I would say that the I mean it's really a cop out on my part to say the answer is maybe. But I think what I would take away from it is like look I expect this cycle to be shallower than previous cycles. In other words, I don't expect a

75% pullback. Is 50% enough? Could it be 60%? Could it get down into the 50,000 again? I think that's entirely possible, but I think the cycle will come. Uh, I think the upside is significant. I think we'll be higher by the end of the year than we are here. And then I think we're going substantially higher in the future because the institutional capital is still coming into the space. >> You know, here's here's something that has always struck me as odd in terms of those, you know, uh, top-to-bottom pullback numbers, right?

And we've seen that kind of just to to reiterate what you're saying is that uh, whatever the first cycle of 2011, 2013, whatever it was, like 89% drawdown, then 85%, then 75%. So, then this time it would be like it's it's, you know, the the the drawdown from all-time high is slowly getting smaller. So, this time don't expect it to go beyond 75%. So, if it gets to 70, go and unlock, you know, remortgage your house. But I'm saying that, you're not saying that. >> [laughter] >> I'm telling you what crypto Twitter says. Um, but to me it's it's so funny to compare to the to use those drawdowns as a metric when the original drawdown 89% is going from like it's a billion-dollar asset down to a hundred-million-dollar asset or even less, right? Like I think

that is just funny to compare those drawdowns when the asset was was only a couple hundred million versus now when it's a couple of trillion. Right? As but but I guess that that's of the metrics we use, that has to be one of them. >> Yeah. Yeah, I I Go ahead, Ryan. >> No, I was going to say I think that's that's actually very, very true. If you look at the Bitcoin cycles table from this this NYDIG research piece that that we've been talking about, you can actually see that play out really, really well. The first cycle, the drawdown was 94% or down 94%. Then down 88%, then down 84%, then down 78%.

Right now we're down somewhere around 50%. Yeah, it's that table right right there next to next to Matt's iconic photo. And uh, >> [laughter] >> staring off into the in the crypto abyss. Um, but I think what you what you said there is exactly right, LG. The market, if you think about what the market looked like in 2011 or 2013 or 2017 or even 2021, there it makes sense that each drawdown has been less less deep, right? Because the market continues to get bigger, to have different forces at play. And what's happening right now is we're going through this one-time multi-year shift where the largest financial

institutions in the world that control tens, hundreds of trillions of dollars, which are is is an incredible amount that a human brain can't map wrap its mind around, they are getting up to speed with Bitcoin and allocating Bitcoin for the long term. They might do might not be doing it all at once today, but they're doing it over this multi-year period. And I think that's why you have a significantly different market today than you did in 2021, where no one would touch Bitcoin at these institutions cuz their compliance departments wouldn't let them or their CEOs said that Bitcoin was worthless or Gary Gensler and Senator Warren become like banging down their their door if they talked about it publicly or with with clients, right? Like it's different. And to say it's not

different, I think would be to have your head in the sand. And so, could we go down lower than this 53%? Certainly. Could we go to 60%? Yeah, 70? Maybe. But I don't think we're going to go to 78%, 84%, 88%, 94% down from all-time highs. I just don't think that we'll we'll do that this time around. >> I just completely agree with what what Ryan is saying. I I would add one more thing, >> Please. >> which is if I took you back to like 2009 and I said, "We're going to create a digital version of gold. And it's going to be new and hugely speculative at the beginning, but over time it's going to get more and more institutional adoption. It's probably going to be cyclical.

Probably have big ups and downs. Uh the the chart that Ryan just showed is like precisely what you would map out in order for that to be true. Right? Uh the price going up, the pullbacks getting smaller over time. Like it's almost what you would have written down word for word in terms of what you would want to see if this asset was going to emerge from uh crazy idea to an institutionally held asset. I think it's like perfectly tracing that road map. >> Mhm. I like that. Is there >> [laughter] >> I was just going to ask you if there's a new asset you were mapping today and what would it look like, but that's totally off topic. That's a weird LG question. Uh well, guys, I think that that's a you know, that's a great way to look at it. Thanks for kind of walking

us through that that that chart and um talking through the bottom and something we have we we kind of have to do. And like I was saying, it is it is one of the main things that is top of mind, right? And people want to know. Um I think we can probably wrap this up by talking about things that are a little bit more positive, right? And that and and we always get such a great dose of that from you guys um from the institutional side, what people are interested in. And also, you know, you alluded to it, Matt, earlier that it's like despite the price action, it's like the industry is healthy. Like there are good things being built here. There's the the the plumbing of the future financial system is being laid down. Um and it feels like you guys feel that um

a lot of the crypto equities are are a good place to look right now as they kind of transform, right? Like the Coinbases, Robinhoods, Galaxies. Tell me a little bit more about that. >> The the Bitwise Crypto Innovators Index, which is uh 30 publicly traded crypto companies uh that have either all of their exposure to crypto industry or at least a material uh exposure to the crypto industry. It's up 30% this year, right? Bitcoin's down 30% year-to-date. Crypto equities are up 30% year-to-date. So, I think it speaks to having diversification across your crypto allocation. And in fact, many of the asset managers we speak with that we help build crypto sleeves or crypto portfolios within their broader portfolio, we talk about just this.

Maybe some just want to have exposure to to Bitcoin, but most want to have diversified exposure across the industry. The reason why I find crypto equities so interesting beyond that is that you're you have exposure to different mega trends and themes. You can own Circle and have exposure to stable coins. You can own Figure and have exposure to tokenization, both of which are mega trends that are growing into the trillions and trillions of dollars over the next decade. You can also own miners who have exposure to Bitcoin and to the AI boom, right? You can own Galaxy, which similarly has exposure to all of these things, or Coinbase, which has exposure to all of

these things, right? I actually think the the Coinbase AI angle is misunderstood and underplayed and I think will will Coinbase will get caught up in that trade eventually. Uh but but nonetheless, like it's it's a little bit more clear of a story and why you would want to own these businesses right now than crypto assets, particularly those beyond Bitcoin, where you're like, "Yeah, I think value of stable coins will accrue to Solana or Ethereum." Same with tokenization, like it makes sense, you can draw that line, uh but it's not 100% clear which will benefit the most. But if you think stable coins are going to 5 trillion, Circle certainly is going to do well.

Coinbase certainly is going to do well and benefit from that, and I think that's why crypto equities are particularly interesting and a lot of investors we speak with find crypto equities interesting for that reason. >> Mhm. [clears throat] That makes a lot of sense. They're so it's kind of like it they're nice hedges on a lot of the other trends that are happening as they kind of diversify and get exposure to to basically everything, right? >> Yeah, yeah, exactly. Then an index of them is is even more. Some weeks you have a boom around stable coins tokenization themes. Some weeks you have a boom around AIs and the Bitcoin miners benefit because they have deals with Google and and Amazon and or you know, hyper scalers and whatnot. So I just think that all together it's a really interesting mix of assets. Now, it was

not going to outperform crypto assets every year, right? I mentioned that the crypto equities index we run is up 30% while Bitcoin's down 30%. There have certainly been years where Bitcoin's been up more or other crypto assets have been up more than this. And I think that speaks to having a well-diversified crypto allocation within a broader portfolio. >> Mhm. >> [clears throat] >> I have one thing I find interesting, too, and it's not it's not really possible for us to do this, but it's it's that these types of companies don't count in the crypto market cap, right? And something a conversation Matt that you and I had last time, which I thought was really compelling, was um that if you remove Bitcoin, you remove stable coins, what is the market cap of like everything else, right? The market cap of DeFi is what we we we labeled it

as, although it's not not exactly perfect. And it was that if you looked at all of DeFi as a company, it has a market cap of, you know, 450, 500 billion. And for what its promise is, that's that's kind of small in a way. But the the trouble with that is that it's kind of it's so it's like a it's like an ETF of like a million million random tokens, some of which could be the next hyper liquid, but others that could be the next uh reverse hyper liquid, which are which are some of them. Um and I think that, you know, one thing that isn't included in any of those is these types of companies, right? The actual crypto equities, they go off and they have their own market caps, right? If you combine if you combine Galaxy and Robinhood and Coinbase, it's like the the what's the

market cap of all three of those combined? Like 130, 140 million or billion, sorry. It's like that itself is a whole separate category that is not often included in the bigger picture of just of just the market cap conversation. >> Yeah, I think that's absolutely right. And I think it's going to get substantially bigger. Um I'd call out one more because I think it points to something that I really love about the crypto equity space, which is Figure. Um the reason I love Figure is that it doesn't matter that they're crypto based. Doesn't matter that they're using blockchain. No one who is getting a home equity line of credit from them cares one ounce about how that's being serviced, but because they're crypto native, they're cutting the cost of originating that loan from thousands to

hundreds of dollars. And as a result, they're just streaking through the market share, right? They're stealing all of it from the entrenched competitors. And you're starting to see this in multiple different areas where people are using blockchain to lower the cost of providing those services and make it easier and more accessible to use, and as a result, they're winning huge amounts of market share, right? You're seeing this with Hyperliquid, you're seeing this with Ree on reinsurance, you're seeing this with Figure on HELOCs. I think that you're going to see a lot more of this in the crypto equity space. Sort of like the first internet companies who scaled real businesses and today are just companies, you're seeing the first sort of crypto companies that are using

blockchain to lower costs and win market share, and in the future those will just be finance companies, right? We'll forget that they're crypto on the back end. But right now they have a real differentiation because they're leveraging this technology better than others. >> Mhm. Mhm. Yeah, that's a that's a that's a good fourth one to include, and we've had their CEO on the show earlier this year, and it's been a big subject of conversation in with our analysts as well who have kind of broken that down as um definitely a really exciting company to watch and and a sign of if things to come as well in the future of like many other similar companies probably emerging over time. One other chart I want to look at, guys, just to wrap up is besides crypto equities is also tokenized stocks, right? We've talked we've talked

tons about Hyperliquid and the trade there, but also we're seeing Solana start to rise up as well, and I've got a few charts for that one is this one from Cobie showing that the volume of tokenized stocks on Solana growing at like a pretty amazing rate in the last year, right? Like up I think 44% month-over-month just this month and really starting to take off making us I guess I guess you know good for Solana kind of fulfilling a different mission outside of meme coins there and then also this one from Mipo Blockworks showing that yeah Solana really like really occupies a huge amount of that volume really quite dominant right now base with just a little bit of the rest and everybody else kind of splitting up

the share of the pile out. And and that a year ago back in June it's like Solana was was way behind it being noses and and avalanche right in that so guys maybe you know as guys who are supporters of Solana as well and also you know >> [clears throat] >> predictors of this kind of stuff happening that people are going to be trading equities on chain is this is this is this chart this this chart look even crazier in six months of this upward chart of for for tokenized stocks on Solana? >> Uh yes 100% do global citizens want to trade US stocks? Yes. Do they want to do it 24/7 365? Yes. Do they want it to be easy and cheap? Yes.

That means it's going to go up into the right right most people still don't know that they can do this. So I think that's going to accelerate and build over time. Look Solana's marketing slogan was on chain capital markets that looks a lot like an on chain capital market that's growing very quickly. So I know I know people label it with the the meme coin background but you know if you look at the growth of tokenized stocks that's where it's happening it's it's wonderful to see. >> Mhm mhm [clears throat] mhm absolutely. Ryan I'll let you kind of wrap up the episode any takes on on the you know this kind of sneaky thing starting to happen even though like Matt said it's it is it is what Solana's mission has been for a long time.

>> Yeah I mean I I think it speaks to the fact that that issuers are somewhat blockchain agnostic and so they're going to go to the high-speed, low-cost options, and I think Solana does particularly well in in providing that service and monetizing that service. And it's something I increasingly think a lot about is, okay, if we are going to see that chart continue to go up into the right, where you just see billions become trillions, become tens of trillions in volume trading on blockchains, which ecosystem is best positioned to benefit from that?

And I think Solana both provides great technology for it and is well positioned as an ecosystem to benefit from it. And and the fact that issuers typically are blockchain agnostic nowadays, they may not have been 3 years ago, but what you've seen time and time again is the issuers start in one place, perhaps Ethereum, and then expand to others. I think Solana is really well positioned to benefit from from this. So, I think we're going to continue to see that number go up. I think Solana's going to be one of the benefactors of all assets moving on chain, and and I think they're doing really well in in monetizing that and showing that value proposition.

>> Awesome. Well, I mean, great to see these these these glimmers of hope in the doldrums of the bear market, and always appreciate you guys sharing those perspectives. Also on the bottom game process, really great thoughts there. Gentlemen, another great episode. Matt, Ryan, thank you so much for your thoughts, and we'll see you next time. >> Thanks so much. >> Thanks for having us. >> Want insights on what's moving crypto markets and how we're [music] trading each event? Subscribe to our channel and join the Milk Road Daily and Pro newsletters and start investing like the top [music] 1%. This show is for educational purposes only. Nothing we say is financial advice. Investing is risky. Never invest more than you can afford to lose.