Wall Street is loud about crypto, but investors aren’t listening: Bitwise

Traditional investors don’t yet realize the impact crypto may have on financial markets, meaning there could be an opportunity to invest in what the technology could eventually become, says Bitwise investment chief Matt Hougan.

“Everywhere I look, Wall Street is screaming that finance is moving on-chain. Not a little of it; all of it,” Hougan said in a note on Tuesday. “Yet traditional investors can’t hear it.”

He argued investors are suffering from “anchoring bias” and are still fixated on how crypto was perceived in its early days — when it was still an unknown technology mostly used by cypherpunks and dark web black markets.

“They look at crypto and still see a punk skateboarder with tattoos. They don’t realize he’s shaved, put on a suit, and is deploying infrastructure that will underpin the next generation of capital markets,” Hougan said.

Major finance companies have launched or are experimenting with facets of crypto technology, mainly tokenization and stablecoins, spurred on by US regulators and lawmakers moving to support the sector.

Crypto investors not registering the shift

Hougan said that crypto investors are also not taking notice of the current shift, as traditional institutions have taken a passing interest in the space before.

“They’re suffering from ‘the boy who cried wolf’ syndrome,” he said. “They’ve heard the promises of institutional adoption for so long that they no longer register.”

Hougan argued, however, that major finance players have begun to move on-chain with the backing of regulators, namely the Securities and Exchange Commission’s “Project Crypto,” launched in July to “enable America’s financial markets to move on-chain,” according to its chair, Paul Atkins.

The value of tokenized assets on blockchains, such as US Treasurys and commodities, has quickly begun to approach $20 billion, he said, more than quadrupling over 2025.

Bitwise’s Matt Hougan said the chart showing the value of tokenized assets on-chain was “steeper than Everest.” Source: Bitwise

“The numbers in question are enormous,” he said, adding that the hundreds of trillions of dollars floating around in exchange-traded funds, stocks and bonds means the tokenization market “can grow 10,000x and still have room to grow.”

Related: Tokenization without provenance is complicity

Hougan added that BlackRock and credit manager Apollo have launched tokenized funds on-chain worth billions of dollars, and major banks JPMorgan, Bank of America, Citigroup, and Wells Fargo are in talks for a stablecoin.

“There is a large delta between what people think is happening in crypto and what is actually happening,” Hougan said.

“From where I sit, that gap creates a significant opportunity — not to try to pick winners prematurely, but to build broad exposure to the space while the market is still mispricing the structural shift,” he added.

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