Matt Hougan of Bitwise and ETF.com Claims 95% of Cryptos Will Perish
In an interview published yesterday, Global Head of Research at Bitwise Asset Management and President at ETF.com Matt Hougan stated his belief that the vast majority of cryptocurrencies will die out.
In the interview, Hougan estimated that “there are 2,000 cryptocurrencies out there; 95% of them are useless and will die a painful death.”
“The sooner that happens,” he went on, “the better.”’
Evoking an oft-heard comparison, Hougan likened the current crypto space to the post-crash dotcom era, when most of the overvalued, overhyped tech companies — Pets.com, for example — had lost most of their value, leaving companies like Amazon, Facebook, and Google to emerge in the subsequent years. In other words, the worthless coins and companies — the “shitcoins,” if you will — need to be weeded out before the true gems can flourish.
Hougan went on to issue something of a hot take, saying he’s “way more bullish on cryptoassets” than on blockchain. Many professionals in the finance sector, especially those not in the crypto space, claim the opposite — that blockchain has the power to change the world, but cryptocurrency is just a fad, a bad application of a good technology.
To explain his position, Hougan once again evoked the dotcom era:
“If you remember the early days of the internet … everyone was really excited about corporate intranets. … People thought corporate intranets were the thing. The analogy between an open internet which people are like no one will trust that….”
According to Hougan, it “is the same between private blockchains and public blockchains” — private blockchains, like the intranet, are only accessible by a limited group of participants, but cryptoassets allow anyone access, just like the internet. “Open, accessible technologies tend to win,” said Hougan. Still, he recognized the role of private blockchains in certain industries, noting their potential use in mortgage management.
Hougan also expressed hope that his firm would be able to launch an ETF [Exchange Traded Fund] that would allow users to gain exposure to the cryptocurrency market. In January, Bitwise filed an application with the Securities and Exchange Commission (SEC) to launch a Bitcoin ETF that would be backed by actual Bitcoin — an important distinction from a synthetic ETF, which is not backed by anything tangible. The SEC has not yet ruled on the application.