The chief investment officer (CIO) of digital asset firm Bitwise, Matt Hougan, believes the pro-crypto stance the U.S. Securities and Exchange Commission (SEC) has recently taken is massively bullish for the industry.
In a new blog post, Hougan says the recent speech by the SEC Chair Paul Atkins outlining a future where traditional assets will be moved to public blockchains and where decentralized finance (DeFi) plays a bigger role is the “most bullish document” he’s ever come across on crypto.
According to Hougan, the SEC’s pivot from a crypto antagonist to a crypto catalyst is “not priced in.”
The “most obvious opportunity,” per the Bitwise CIO, is the layer-1 blockchain sub-sector that supports stablecoins and tokenization.
“It doesn’t take a genius to see it: If substantially all assets are going to move onto public blockchains, you want exposure to those blockchains.
Which ones?
The best approach is likely to buy a basket of the leading assets: Ethereum, Solana, Cardano, XRP, Avalanche, Aptos, Sui, NEAR, and so on.”
As the cloud of regulatory uncertainty that has hamstrung the growth of DeFi apps disappears, Hougan says the sector offers another opportunity.
“Despite the lack of regulatory clarity, DeFi apps have significant usage. Uniswap, the largest spot trading app, processed $88 billion in trading volume in June, its best month ever. DeFi lending protocols like Aave also hit a new high, with $56 billion in total value locked. Derivatives platforms like Hyperliquid are massive.
With greater clarity, could these numbers rise by 10x? 50x? 100x? As traditional and crypto markets merge, the opportunity is huge.”
The Bitwise CIO says super-apps that offer a wide array of financial services to their users are likely to be another beneficiary of the SEC’s 180-degree pivot.
“…it’s hard not to think of Coinbase and Robinhood, two firms that have embraced the super-app concept, albeit from different ends of the spectrum: Coinbase started in crypto and is moving toward traditional assets, while Robinhood started in traditional assets and is moving quickly toward crypto.
I’ll go out on a limb here: One of these companies could become the largest financial services company in the world, maybe even becoming the first financial services company worth more than $1 trillion.”
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