Bitwise Chief Investment Officer (CIO) Matt Hougan believes that crypto index funds, which offer investors exposure to a diversified basket of digital assets, will become a significant force in the market by 2026. Hougan stated that as the cryptocurrency market grows more intricate and its use cases expand, these funds will play a crucial role. He emphasized that crypto index funds can mitigate the risk of investors missing out on substantial growth opportunities within the market.
Industry Divided on the Future of Crypto
Hougan acknowledged the inherent uncertainty surrounding the future trajectory of the digital asset sector. He highlighted the ongoing debate within the crypto community regarding the dominance of specific platforms, such as the comparison between Solana and Ethereum. While some proponents argue for Ethereum's long-term market leadership, others contend that Solana is positioned to surpass it.
Crypto index funds are set to gain major traction in 2026, says Bitwise’s Matt Hougan. As the crypto market becomes more complex, these funds offer diversified exposure, reducing risk compared to single-asset ETFs. Expect growth amid evolving use cases and regulation! #Crypto pic.twitter.com/sMi9NkHpcj
— Crypto Hawk (@CryptoKelvin12) December 9, 2025
He also noted the perspective held by some in the crypto community that Bitcoin is the sole digital asset of importance. Hougan admitted that despite his extensive network within the digital asset ecosystem, which includes venture capitalists, founders, researchers, and foundations, he cannot definitively predict the market's future outcomes. He described the current stage of crypto's development as "unknowable."
Hougan suggested that a confluence of factors, including regulatory developments, execution capabilities, macroeconomic conditions, the actions of key individuals, and sheer luck, will shape the crypto market's evolution. He cautioned against claims of certainty, stating that individuals who profess such confidence may be misleading themselves.
Crypto Index Funds: The Key to Capturing Market Growth, According to Hougan
Hougan projected that the overall crypto market could experience a tenfold to twentyfold increase in value over the next decade without encountering significant obstacles. He reiterated his strong conviction that the digital asset market will be considerably more impactful in ten years than it is today.
He referenced a recent interview where US Securities and Exchange Commission (SEC) Chair Paul Atkins expressed his expectation that all US equity markets would transition onto the blockchain within the next few years. Hougan pointed out that this represents approximately $68 trillion in equities, contrasting it with the current tokenized stocks market's combined capitalization of only $670 million.
However, Hougan acknowledged the difficulty investors will face in identifying the specific assets and opportunities within this burgeoning market that will drive substantial growth and generate significant returns. He posed a hypothetical scenario where an investor could correctly predict a market experiencing 100,000x growth but still underperform by backing the wrong assets.
Given the inherent complexity of the crypto space, Hougan advocates for an investment strategy of "buying the market" through market-cap weighted crypto index funds. He then complements this broad exposure with "individual bets around the edges." While acknowledging that crypto index funds may not be suitable for all investors, he believes they offer a valuable starting point for many, including himself.