Four Crypto Catalysts the Market Isn’t Pricing, According to Bitwise

Crypto markets still haven’t priced in a few important catalysts that will supercharge price action in the coming months, according to Matt Hougan, Chief Investment Officer at digital asset management firm Bitwise.

The crypto market has performed fairly strongly so far in 2025, but Hougan argues the best is yet to come, driven largely by governments stockpiling crypto and favourable monetary policy out of the US.

Hougan has long argued that ETFs, corporates and governments will drive the next crypto boom. So far, though, only ETFs and corporates have been aggressively accumulating crypto. 

Hougan believes that before the end of the year, we’ll see governments start stacking Bitcoin too, driving the market higher.

“The popular conception is that sovereign adoption of bitcoin as a reserve asset has fallen off the table. I suspect this is wrong,” he said. 

Countries and central banks move slowly, but based on the conversations we’re having at Bitwise, they are moving…That realization alone could push prices substantially higher.

Matt Hougan, Chief Investment Officer Bitwise

The Bitwise CIO also believes the market is underestimating the impact of looming interest rate cuts and potentially large-scale money printing in the US. 

“The market is pricing in multiple rate cuts by year-end, which should be supportive for bitcoin. But I think the market is missing a much bigger story here,” Hougan explained. 

The Administration is strongly signalling that it wants much lower rates and a much weaker dollar. Not three rate cuts. Try six. Or eight.

Matt Hougan, Chief Investment Officer Bitwise

As evidence for this, Hougan cited the appointment of “weak dollar advocate” Stephen Miran to the US Federal Reserve Board of Governors. Miran has previously called for a new “Mar-a-Lago Accord.” Hougan characterised this as being designed to “reduce the value of the dollar against its global peers, and has suggested the Fed can achieve this goal by printing large numbers of dollars.”

Historically, Bitcoin has performed most strongly when the US has lower interest rates and a weaker dollar. If the US does in fact go down the path of aggressively cutting rates and firing up the money printers, Hougan thinks “bitcoin could trade significantly higher.”

Related: Bitcoin Posts All-Time High as Market Expectations Grow

Lower Volatility And Resurgence of ICOs to Further Boost Market, Says Hougan

Hougan also pointed out that since the launch of the Bitcoin spot ETFs in January of last year, Bitcoin’s volatility has reduced significantly. The Bitwise CIO wrote that this reduced volatility has boosted interest from institutional investors.

“In my conversations with institutional investors, this lower volatility is translating into much higher portfolio allocation considerations than in the past. Whereas 1% was the primary starting point for conversations in the pre-ETF era, I now regularly hear talk of starting at 5% or more.”

An important driver of the huge inflows into Bitcoin spot ETFs we’ve seen recently is this reduced volatility, said Hougan, which has triggered institutional investors to increase their holdings.

The fourth overlooked market catalyst identified by Hougan is a potential resurgence of initial coin offerings (ICOs), which effectively died off in the wake of the 2017-2018 ICO era after a glut of scam projects and rug pulls soured investors on the concept.

Related: Project Crypto: Bitwise Names Three Key Winners From the SEC’s Blockchain Utopia

Hougan believes we could see ICOs return this bull run, citing pro-crypto comments from new Securities and Exchange Commission (SEC) Chair Paul Atkins. Atkins called for purpose-fit disclosures, exemptions and safe harbours for ICOs to drive an explosion in innovation, during a speech he gave last month in which he outlined the SEC’s new regulatory stance towards crypto, dubbed “Project Crypto”.