Video summary
At the end of 2025, Bitwise reaffirmed its prediction that Bitcoin will reach a new all-time high in 2026, effectively breaking the traditional four-year cycle of three up years followed by one down year. Although the market recently experienced a prolonged "crypto winter" characterized by significant outflows and macroeconomic uncertainty, the firm believes the asset has already bottomed out and recovered from lower price levels. The speaker emphasizes that Bitcoin is a momentum-driven asset that only needs a modest additional gain to turn positive for the year, citing enormous acceleration in ETF flows and ongoing purchases by treasury companies as key indicators. While the current geopolitical conflicts and inflation concerns have created headwinds, Bitwise expects these factors to settle by the fourth quarter, allowing strong seasonal momentum to propel Bitcoin toward new records.
The conversation also addressed the unexpected challenges faced by crypto ETFs earlier in the year, particularly the massive capital rotation into artificial intelligence equities and assets like SpaceX following its IPO. This shift caused a temporary sell-off in both gold and Bitcoin, but Bitwise argues that this was merely a rotation rather than an exit from the market entirely. As equity markets stall after their rapid rise in the first half of the year, investor attention is expected to return to crypto, which currently looks attractive relative to other asset classes trading near all-time highs. Furthermore, positive developments such as the momentum in tokenization, regulatory clarity regarding stablecoins under the GENIUS Act, and growing concerns about fiat currency debasement are creating a favorable environment for capital to flow back into the cryptocurrency ecosystem.
Looking beyond the immediate future, Bitwise maintains a long-term bullish outlook, predicting that Bitcoin will surpass one million dollars per coin by 2030. This projection is driven by the expanding access to Bitcoin through institutional channels like ETFs and wealth management platforms, where advisors are slowly allocating client funds after initial engagement. The firm notes that while Bitcoin may have underperformed the S&P 500 in recent years, it has historically outperformed major indexes over the long term, making it a preferred holding for investors focused on the next decade rather than short-term trading. As more financial institutions integrate Bitcoin into their model portfolios with recommended allocations ranging from 2% to 6%, and as the market cap of Bitcoin grows relative to gold, the asset is positioned to capture an increasing share of the global hard asset market. Ultimately, Bitwise believes that a combination of institutional adoption, regulatory progress, and the persistent threat of currency debasement will drive sustained price appreciation over the coming years.
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At the end of 2025, you made a few
predictions for 2026. One of them from
Bitwise was that Bitcoin was going to
reach a new all-time high in 2026 and
that the 4-year cycle will be broken.
So far, the the 4-year cycle has been
playing out pretty much regularly and
Bitcoin is still down 40% roughly 40%
from its previous all-time high. So, do
you still stand by your prediction?
>> Yes, it's a it's a good question. Look,
I think what's important to remember is
that we just saw a near 30% jump in
Bitcoin prices in a very short period of
time. So, this is a heavily
momentum-driven
and highly reflexive asset and asset
class. We only need another 10% or so to
turn positive year-to-date. We've seen
enormous acceleration in ETF flows.
We've seen ongoing purchases by treasury
companies. And from where we sit at
Bitwise, the investors we're speaking to
are really excited about where we're at
in terms of developments, catalysts, and
fundamentals. And so, I do think that we
could reach a new all-time high this
year. I definitely think we're going to
end the year positive, which would break
that 4-year cycle of three up years and
one down year. Of course, this year is
supposed to be a down year based on that
cycle. New all-time highs is a little
bit harder of a reach, but I do think
with the continued momentum, strong Q4
that we typically see, and a little bit
of the macro uncertainty settling, we
could certainly shoot to new all-time
highs in 2026.
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>> And now let's get back to the
conversation.
I still wanted to touch on another
prediction that you made last year. So
it was about ETFs. Basically, you were
saying that
2026 was going to be like an amazing
year for crypto ETFs, that ETFs will
sort of absorb over 100% of the new
supplies of uh
uh
of of Bitcoin, but also other
cryptocurrencies. We are seeing that
there is still a net outflows are at
this moment
from the point of view of Bitcoin ETFs,
and it's at least $1 billion
We saw huge outflows in May-June, I
think. Now it's recovering a bit. What
happened
during the year that you didn't expect
from the point of view of uh the ETFs
inflows and outflows?
>> Yeah, it's a it's a good question. So I
think heading into 2026, if you remember
we made these predictions the end of
November. So we were right after the
October 10th flash crash. A bunch of
liquidity left the ecosystem. And from
there we entered this prolonged crypto
winter. And I think the summer really
was kind of the the depths of that
crypto winter. We believe we've
bottomed. We think price is, you know,
clearly recovered from the 60k range for
Bitcoin, for for lower for many other
alts. And what we've seen is a reversal
in bit Bitcoin ETFs going from outflows
in the summer to several billion of
inflows so far in in in August and
September.
The the thing that we weren't expecting,
I think that was difficult to forecast,
was the rise in macroeconomic
uncertainty and geopolitical conflict
this year, which has affected all macro
assets. It's inflected It's It's
affected oil prices and inflation
prints, which in turn changed the
likelihood of rates from cuts to hikes,
which going into this year, the
expectation by the market was that we
would see several rate cuts. Right now,
there's a slightly higher than a coin
toss probability that rates get raised
at the next FOMC meeting or at least
this year. So, I think there was some
macro factors and geopolitical factors
that played a role this year in terms of
investor appetite for risk-on assets.
The other thing that we didn't
necessarily forecast, but certainly
played out, was this broad capital
rotation that we saw across investors
out of crypto, out of other asset
classes, and into AI in the equities
market. The SpaceX IPO is a great
example of that. When we were speaking
with investors around the time of the
SpaceX IPO, they mentioned that they
were selling assets to raise capital to
get exposure to SpaceX cuz clients were
asking for it, because they wanted
exposure to it. It was going to get
added to the Nasdaq and become
part of the benchmark, so they needed
have some exposure, otherwise they're
short SpaceX. But, it was such a massive
IPO that the capital pull from other
asset classes, including crypto, but
also including things like gold, drove
prices lower. I think you saw the
sell-off in gold happen around the same
time as the sell-off in Bitcoin and
crypto assets midsummer, and that's not
super surprising given we knew that
capital was rotating. Look, the momentum
in the equities market is certainly
still there, but it's started to stall
out. And while I don't think equities
are going to be poor performing over the
next 6 to 12 months, I do think they'll
underperform crypto assets as investors
start to reposition themselves in across
the asset class spectrum. We know
investors we were speaking with back
then weren't saying they were exiting
crypto forever, just like they're not
exiting gold or other asset classes
forever. It was a rotation and like all
rotations, it comes back around. And
most investors we speak to today are
thinking about if right now is the right
time to re-enter the market, if they've
missed the bottom, which, you know,
around 60K would have been much more
favorable entry point than around 80K.
So, what I think that means is that
investors are paying attention and we'll
see capital rotate back in. A lot of
that will manifest itself in ETF flows.
>> I wanted to touch on what you just said
regarding the battle for attention. So,
for sure, in 2026, as you also mentioned
in a recent interview, crypto has sort
of lost the battle for attention from
from investors.
What I wanted to ask you is
what is happening or what should happen
to regain the attention of investors? Or
maybe that's already happening, I don't
know.
>> Yeah, it looks you right. I think all
the things are happening right now. One
thing for certain that needed to happen
is that you needed to see equity stop
having these blow-off momentous rises
that they had in the first half of the
year. And I think that's certainly
happened. Optimism around the non-stop
up only eight I trade has faded a bit.
Equities have stalled out. I know a lot
of investors worry about the September
seasonality of equities and and a lot of
the investment committees we're on and
other folks that we speak to are very
aware that September is historically a
down month for equities. And so, I think
what investors are doing is taking a
step back from the market. They're
surveying all the potential investments
they can make, all the different asset
classes, and crypto looks attractive
relative to other asset classes right
now. It's been trading down while
everything else is trading near all-time
high. So, I do think that's part of the
battle for attention. The other things
that are happening to gain investor
attention are things like massive
momentum in tokenization. It seems like
every other day we're seeing a major
headline around some new all-time high
in tokenized stocks on Solana or some
other network. We're seeing tons of
financial institutions start tokenizing
funds or explore tokenization. We're
getting the clarity from the SEC around
how to tokenize asset, what's it mean
from a regulatory perspective. So, I
think that's positive. You also have the
stablecoin momentum behind us, which,
you know, started when the genius act
passed last year and was signed into
law, but now there's been this long lag
between when it was passed and when it
actually goes into effect. Now, the
stablecoin uh act, which regulates
payment stablecoins, goes into effect in
early 2027. But right now, we're in that
final rulemaking period for agencies
that then tell banks and other large
businesses how to engage with regulated
payment stablecoins. So, I think that's
another thing that's turning in crypto's
direction, and it gets a lot of
attention from Wall Street and
mainstream finance because stablecoins
not only are such a big deal in DC right
now when people talk about the Clarity
Act and what's hung it up, but because
businesses know that stablecoins are set
to disrupt
their typical payment flows and
transaction processes if they don't
adapt them. So, I think you have
tokenization, I think you have
stablecoins. You also have the
debasement trade, which has reared its
head again in August with gold and
Bitcoin performing strongly at the same
time that the US crossed 40 trillion in
debt for the first time. And all of a
sudden you're seeing headlines and every
talking head across any financial media
outlet talking about the runaway debt
and and the the inability for the US to,
you know, move beyond this. And what
happens in those times, investors turn
to hard assets like gold and like
Bitcoin. So, I think we have a few
things that are actually turning in the
right direction already and have already
turned. Investor attention, we believe,
will follow and I think that will drive
a lot of capital back into the crypto
space.
>> Now, I was talking to an expert not long
ago who was basically saying,
"Uh I wonder when Bitcoin will
go back outperforming
indexes because
if Bitcoin won't
uh become again this uh
highly performative asset that is able
to outperform indexes, then
uh investors would start asking
themselves, why should they take on the
additional risk of Bitcoin when
if you look at the performance in the
last 5 years, you see that in terms of
performance, Bitcoin has
as underperformed the S&P 500 in the
last 5 years at least." So, I'm not sure
whether the wealth managers you're
talking to or some other clients are
also expressing the same concerns
regarding this, but what are your
thoughts on that issue?
>> Yeah, well, I think look, investors who
have been paying attention to crypto or
just getting into crypto are definitely
aware that Bitcoin's been one of the
best performing major assets for the
past decade. And of course, there's been
periods between then where Bitcoin's
underperformed or outperformed the S&P
500 or the Nasdaq or other indexes they
may track. But over the long term,
Bitcoin's outperformed all of them. And
I think what you see today is that
investors have a a more access to
Bitcoin through things like ETFs, a lot
of wealth management platforms, and the
large RIAs and wirehouses now allow
their advisors and wealth managers to
access Bitcoin in client accounts. So,
that changes the narrative a little bit
because we have all this capital that we
said is rotated out of crypto or maybe
been sidelined from crypto because they
haven't had the access to it, but they
know that over the long term Bitcoin has
outperformed these other indexes that
they track against. And when momentum
turns in Bitcoin's favor, I think we're
well positioned for a lot of those
investors to make those allocations. I
think you saw that with the several
billion of inflows not only in the
Bitcoin but into other majors like
Solana, XRP, and Ethereum. And so, when
we talk about Bitcoin's performance at
Bitwise, we take a very long-term
oriented view. And that's because most
of the investors we face off with,
traditional financial advisors, RIAs,
and wealth managers, these are long-term
oriented investors. They typically don't
try to trade in and out of a bunch of
assets throughout the year. They take
positions once they have conviction and
they hold them for the long term. And I
think that's what we're going to see
here as the price continues to stabilize
around 80,000 and moves higher. And so,
yes, it underperformed over a short
period, but it's outperformed over the
long term. And many of the new investors
coming into Bitcoin aren't day traders.
They're long-term who are positioning
their portfolios and their client
portfolios for the next decade, not the
next 6 months.
>> What are the macroeconomic catalysts
that could
drive Bitcoin price higher in the next
couple of months?
>> Well, certainly an end to the conflict
in Iran would help because you would see
oil prices reset at lower levels, which
would reduce inflation fears, which
would reduce the likelihood of rate cuts
that the market is pricing in right now
and give the Fed some room to breathe.
So, I do think the conflict in Iran just
dragging on longer than most people
expected plays a role, but with an end
potentially in sight because we don't
think that the Trump administration
wants this to drag on much longer, I
think that's a positive macro catalyst
if and when it does
come. The other thing that's been
playing a role somewhat is this will
they, won't they on the tariffs front,
right? Like tariffs increase costs which
therefore increase inflation
expectations have the same knock-on
effect on rates. So, those are two
things that have really played a role
this year in terms of macro headwinds
that we've been facing, but I do think
that what we saw was that Warsh is still
not showing his hand in terms of what
the FOMC is going to do. We saw Bullard
and Clarida start to intervene first
with the yen, then saying his
intervening with the long end of the
bond market. I think that's a sign that
the US doesn't want rates to go much
higher and that's a very powerful force.
What we've historically seen is Bitcoin
performs well in low rate environments
as investors go and look out along the
risk spectrum for higher yield returns.
So, if we see the macro environment
settle, if we actually don't see rate
hikes and we see rates stay flat or come
down, we see bonds start to normalize
back to to normal levels and if we see
an end to this conflict in the Middle
East, I think those are macroeconomic
winds that turn in crypto's favor and in
Bitcoin's favor in Q4.
>> I would like to know your price
prediction for Bitcoin for 2030.
>> Ah, I love this question cuz as I
mentioned, we love to think about things
long term.
My view is that Bitcoin's going to be
above 1 million per coin in 2030. I
think there's a bunch of factors driving
it higher, but if you zoom out, the
things that I think are most important
is that we're expanding access for an
institutional investors to Bitcoin. They
now can access Bitcoin in ETFs in client
accounts across almost every major
wealth management platform. But what's
important to remember is just because
they get access doesn't mean that they
allocate right away. One interesting
anecdote from our time at Bitwise is
that historically it's taken about eight
meetings from an an advisor engaging
with us to actually allocating to a
Bitcoin fund. And those meetings don't
happen every week for eight weeks. They
typically happen once a quarter or so
over the span of two years. So running
that back, if most of these advisors are
just getting access to Bitcoin this
year, it stands that they would likely
won't allocate towards the end of this
year or maybe the middle of next year.
And I think that capital, once it starts
coming into the into the ecosystems,
will stay and a lot of advisors start
with 1% and then ladder up from there to
2% or 5%. So I think institutional
capital coming into the Bitcoin space is
going to drive the price higher. I think
continued regulatory clarity, not just
for Bitcoin but for the entire industry.
We have regulated payment stablecoin
legislation with the genius act going
into effect later this year. We're going
to churn through the uncertainty about
the clarity act and get rules either
from
Congress or from the SEC and CFTC around
regulation. That's going to be a
positive that allows investors to feel
better about making allocations. And you
have this continued rising concern
around debasement of traditional fiat
currencies. And it's something that is
going to continue to push investors into
hard assets over the next decade through
2030 and beyond. And when they look at
hard assets that have the ability to
hedge against fiat debasement, Bitcoin
and gold are really the two out there
that we see benefiting the most. And the
thing is is the gold market is massive.
The Bitcoin market is tiny. It's like 1%
of the gold market or 2% of the gold
market. And we think the store value or
hard asset market is going to grow over
time much larger than it is today. It's
grown over the past decade at like a 10%
kegger. We think that will continue into
the future. And we think that Bitcoin
share of that market will grow. So,
Bitcoin share of a growing market will
increase. And I think debasement will be
a big part of that.
And lastly, I would just add that we
continue to see so much investor
interest in things like model
portfolios, which is a set and forget
method that a lot of wealth management
platforms use. And we've seen everyone
from Charles Schwab to Fidelity to
everyone in between talk about how most
investors should hold anywhere from 2 to
6% Bitcoin in their portfolios,
depending on their risk preferences. And
a lot of these platforms are starting to
add Bitcoin to their model portfolios.
So, I think the institutional capital is
going to flow into Bitcoin. I think
concerns about debasement is going to
flow assets into things like Bitcoin and
gold. And as Bitcoin continues to reduce
its volatility and as its as its
correlation to equities continues to
trend back to where it historically has,
because it's been high recently,
I think those things will all drive
investors to adding Bitcoin to their
portfolios alongside gold as part of
their typical portfolio allocation.
>> Thanks again for joining us and um hope
to see you soon on our show.
>> Amazing. Thank you, Giovanni. Great to
be here and hope to do it again soon.
>> [music]
[music]
>> Mhm.