Podcast Source: Empire
Broadcast Date: December 8, 2025
Guest: Bitwise Chief Investment Officer (CIO) Matt Hougan
Compiled and Edited by: BitpushNews
This content is compiled from the latest episode of the crypto podcast Empire, "Institutional Flows Will Overpower the 4-Year Cycle". The guest was Bitwise Chief Investment Officer (CIO) Matt Hougan.
In the episode, Matt delved into key topics such as "Is Bitcoin's Four-Year Cycle Losing Its Influence?", "Accelerating Institutional Capital Inflows", and "Whether MicroStrategy Faces a Real Risk of Being Forced to Sell Bitcoin". He also gave his judgment on the Haseeb–Santi debate regarding L1 blockchain valuations and shared his views on the driving forces for the next phase of growth in the crypto market.
(The following is a transcript of the interview content)
Q1: The market has been very volatile recently, with significant drops often occurring on weekends. What's your take?
Matt Hougan:
Short-term volatility itself doesn't signify much, but a kind of "weekend panic mode" has indeed formed over the past few months. Because the crypto market trades 24/7 all year round, while humans don't stay awake all year, market liquidity is naturally weaker on weekends. Coupled with the fact that major macro policies are often announced on Friday afternoons, the crypto market has to price in this news in advance, often amplified over the weekend.
So I don't think this is a change in fundamentals. In fact, we are discussing a market that has remained flat overall this year, yet the sentiment has been amplified to feel like a crash. Many investors are nervous now simply because they remember that "something often happens on the weekend." This is not a signal of a long-term trend.
Q2: From a more macro perspective, how do you view the market for 2025–2026? Is the four-year cycle still valid?
Matt:
I've said it many times, I believe the so-called "four-year cycle" is basically obsolete. It held true in the past because specific factors coincided, and these factors no longer have enough influence today.
The supply shock from halvings is affecting the market at a diminishing rate; the interest rate environment is completely different from the previous two "cycle correction years" (2018, 2022), as we are now in a rate-cutting cycle; the risk of "systemic blow-ups" that caused massive corrections in previous cycles has also significantly decreased. In other words, those原始 forces driving the cycle have now weakened.
But on the other side, one force is becoming increasingly powerful—the entry of institutional capital. Over the past six months, traditional giants like Bank of America, Morgan Stanley, UBS, and Wells Fargo have successively opened up to crypto asset allocation, representing over $15 trillion in total assets. This is a decadal-level force, powerful enough to overpower the so-called four-year cycle.
So I am very clear: I do not think 2026 will be a down year; on the contrary, I believe it will be strong.
Q3: You mentioned that much of the "OG selling pressure" doesn't come from on-chain addresses. Where does this selling pressure come from then?
Matt:
Many OG holders have not sold their coins directly in recent years, so on-chain data doesn't show "old wallet movements," but they have engaged in an equivalent form of selling pressure: writing covered calls.
Simply put, they don't want to sell their long-held Bitcoin (due to high tax liabilities) but want to realize some gains, so they collateralize their Bitcoin to write options, earning an annualized 10%–20% yield. This operation essentially "sells" future upside gains to the market, creating price pressure equivalent to a partial sale, but it is not marked on-chain as "old addresses moving assets."
This type of business is growing very fast at Bitwise, and we are not the only provider. I suspect there might be implicit selling pressure in the scale of tens of billions of dollars coming from this structural selling.
Q4: Does MicroStrategy really face a risk of being forced to sell coins? Why does the market keep worrying about this?
Matt:
There is absolutely no need to worry. I even think this is a misunderstanding.
MicroStrategy's annual interest expense is about $800 million, while it has $14.4 billion in cash on hand, enough for the next 18 months. Its debt is about $8 billion, while its Bitcoin holdings are worth over $60 billion. More importantly, its earliest debt repayment is not due until 2027.
Unless Bitcoin's price crashes by 90%, there is simply no situation of "being forced to sell." And if it really drops 90%, the entire industry would be in worse shape than MicroStrategy.
So the correct concern is not "will they sell," but "they might not buy as much as before in the future." That is the marginal impact.
Q5: Which companies or institutions are you more concerned about regarding selling pressure?
Matt:
If we use the "missionaries vs. mercenaries" model, I think:
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Missionary Type (e.g., Saylor): Almost impossible to sell.
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Mercenary Type (small companies模仿 MicroStrategy): Will exit in the future, but they are too small, so even if they all sell, it won't cause systemic impact.
Q6: In your meetings with large financial institutions, what are they most concerned about?
Matt:
I spend a lot of my time communicating with these institutions now. The questions they ask are very basic: Why does Bitcoin have value? How do you value it? What is its correlation with existing assets? What is its role in an investment portfolio?
A key fact that is often overlooked: Institutional decision-making is very slow.
Bitwise's average institutional client often requires 8 meetings before actually buying, and these meetings are sometimes quarterly. So you understand why Harvard University is only now adding Bitcoin—they started researching from the day the ETF launched, and it took a year to get approval.
Giants like Bank of America manage $3.5 trillion in assets. Even a 1% allocation would be $350 billion, which is more than the net inflows into all Bitcoin ETFs to date.
This is why I say: Institutional adoption is the most important force for the market in the coming years.
Q7: Why are Financial Advisors (FAs) so slow to accept crypto assets?
Matt:
Because their goal is not to pursue the highest portfolio returns, but:
"To avoid being fired by clients due to losses."
If an FA had allocated client funds into Bitcoin in 2021, and the FTX incident caused a 75% drop in 2022, the client would definitely fire them immediately.
While AI stocks like Nvidia could also drop 50%, the market narrative is "future trend," whereas the media narrative for cryptocurrency is still questioned, so the "risk of being fired" is higher.
As volatility decreases and narratives around stablecoins and asset tokenization (RWA) strengthen, crypto assets are becoming more "acceptable for professional advisors."
Q8: Regarding L1s like Ethereum and Solana, how do you explain their differences to institutions?
Matt:
The strategy is simple:
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First emphasize the differences (technical path, speed, cost, design philosophy)
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Then suggest "buying a little of everything"
The reason is that advisors spend an average of only 5 hours per week researching their investment portfolios, of which maybe only 3 minutes are allocated to crypto assets.
Matt said:
"If I only had three minutes a week to research crypto, I could never judge which chain will ultimately succeed, so the most reasonable method is to diversify holdings."
In terms of understandability:
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Uniswap and Aave are the easiest to understand, as they are "decentralized Coinbase" and "crypto lending banks" respectively.
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Chainlink is also very popular with institutions, because you can directly say:
"Chainlink is the Bloomberg terminal for the blockchain world."
Q9: What do you think about the Haseeb vs. Santi debate on L1 valuations?
(Bitpush Note:Haseeb Qureshi is a partner at crypto venture capital firm Dragonfly Capital, representing a more long-term view. He believes the market severely underestimates the future transaction volume and network effects of public chains (L1s), and that using current data for valuation underestimates their long-term potential.
Santi Santos is a crypto investor and researcher, representing a more traditional finance-oriented rational valuation school. He emphasizes that public chains must ultimately be priced based on revenue, fees, and real economic value, and believes the current valuation of some L1s excessively discounts future expectations.)
Matt:
I think they are both actually right, but their focus is different.
From a long-term structural perspective, I am indeed closer to Haseeb's view. Our current imagination regarding on-chain transaction volume, economic activity, and asset settlement frequency is too conservative. A simple example: Why are wages paid every two weeks? They could be settled hourly or even by the minute, and this shift would mean on-chain transaction volume would grow exponentially.
But I also agree with Santi on one point: Ultimately, all L1s must be valued based on real economic metrics. Revenue, fees, protocol captured value—these are unavoidable. It's just that the financial data we see now is far from reflecting the future network scale.
I would summarize it like this—
Valuation will ultimately be based on financial performance (Santi is right), but the future economic scale will far exceed current models (Haseeb is right).
Q10: If you were the founder of a token project, what do you think should be done now to make the token more investment-attractive?
Matt:
I believe crypto projects are transitioning from the "pure community narrative era" to the "quasi-public company era." This means project teams need to learn mature practices from traditional capital markets, such as:
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Regularly publishing transparent operational and financial data
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Holding quarterly update conference calls
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Establishing Investor Relations (IR) teams
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Clearly explaining protocol revenue, economic models, and long-term vision
Many foundations over-raised in recent years, with inefficient use of funds. I think project teams should, like Arbitrum, manage their treasuries as a real investment portfolio, not as a short-term subsidy mechanism.
These measures are not just formalities; they are communication methods proven effective by capital markets over centuries.
Q11: What changes do you think will happen to ICOs and token issuance models in the future?
Matt:
I have always thought that the 2017 ICO was a "premature but correct" attempt. The idea itself was not wrong, but the economic models were immature and regulation was unclear at the time, leading to many projects failing to deliver on their promises.
In the future, I believe ICOs will make a comeback, and the scale will be much larger than in 2017. Compared to traditional IPOs, ICOs are faster, more democratic, lower cost, and the current regulatory environment allows tokens to be directly linked to protocol economic activity, giving tokens real economic value.
In the long run, I even think the way companies go public will gradually shift from IPOs to native token offerings, or a fusion of both.
Q12: What's your view on the landscape for privacy coins like Zcash in institutions?
Matt:
Zcash's narrative is very clear, but currently, the regulatory side is still sensitive, especially regarding compliance discussions on "default privacy vs. optional privacy."
Therefore, ETFs and institutional products find it difficult to touch Zcash.
However, he emphasized:
"In the future, the crypto space will expand from one narrative to ten narratives, and privacy will be one of them."
It's just not yet the time for institutions to布局 privacy assets.
Q13: What is your final judgment on 2026?
Matt Hougan:
I think 2026 will be very strong. Institutional inflows are accumulating momentum, the regulatory environment is turning from a headwind to a tailwind, and new narratives like stablecoins, asset tokenization, and on-chain finance are spreading. The market might be disappointed with these narratives at some stages, but that's a matter of pace, not direction.
To summarize in one sentence:
We are now just at the entrance of the next massive growth cycle.
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