Institutions Stay Bullish On Bitcoin As Retail Falters: Bitwise CIO Sees Crypto Rally Ahead

"Bitwise CIO Matt Hougan says the crypto market may be nearing a turning point as retail exhaustion deepens and institutional demand quietly builds. Appearing on CNBC, Hougan - who oversees $12 billion in assets at Bitwise - said retail sentiment is at "maximum desperation" following months of liquidations, leverage blowouts, and yield protocol failures. "It's hard to find a crypto native investor who still has much enthusiasm," he said. "That market is close to a bottom.""

""When I speak to financial advisors, they're still excited to allocate to an asset class that's delivered strong long-term returns," he said, adding that he expects a year-end rally as institutional capital begins to take the lead. "So I'm optimistic, but we do have to finish this wash out of retail sentiment," Hougan said."

"Meanwhile, on Capitol Hill, Senator Cynthia Lummis reaffirmed her support for digital asset integration within the U.S. banking system. Addressing tensions over stablecoin regulation, Lummis said she wants community banks to be able to custody and manage both fiat and digital assets. "This is the 21st-century economy," Lummis said on X. "Digital assets are the future, and we need to make sure community banks embrace the opportunity." She noted that Louisiana, Virginia, and Wyoming already allow banks to custody crypto - and expects more states to follow as new legislation advances. Bitcoin and the broader crypto market has seen a turbulent month, dipping below $100,000 on Tuesday - its lowest level since June - before rebounding above $103,000 today."

Retail sentiment is at maximum desperation after months of liquidations, leverage blowouts, and yield protocol failures, leaving few crypto-native investors with enthusiasm. Institutional investors and financial advisors remain upbeat and continue allocating to an asset class with strong long-term returns, creating potential for institutional capital to lead a year-end rally once retail sentiment completes its washout. Policymakers are pushing for digital asset integration in the U.S. banking system and want community banks to custody and manage both fiat and digital assets, with several states already allowing banks to custody crypto. Bitcoin experienced heavy selling, nearly $1.8 billion in ETF outflows, and dollar strength, dipping under $100,000 before rebounding above $103,000.

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