Bitwise Chief Investment Officer (CIO) Matt Hougan says crypto index funds, which offer investors the ability to buy into a basket of assets, will be “a big deal” in 2026.
“The market is becoming more complex and the use cases are increasing,” says Hougan said in a recent note to investors, adding that crypto index funds reduce the risk that investors will miss the market’s 10x growth potential.
Industry still divided over the future of Crypto
Hougan said it’s hard to say what the future will look like for the digital asset space.
To illustrate his point, he highlighted the debate surrounding Solana versus Ethereum. He noted that on the one hand, members of the crypto community say Ethereum is better and that it will dominate the market. On the other hand, there are those who say Solana is poised to overtake Ethereum in the long term.
Crypto index funds will gain major popularity in 2026, says Bitwise’s Matt Hougan.
As the crypto market becomes more complex, these funds provide diversified exposure, reducing risk compared to single-asset ETFs.
Expect growth amid evolving use cases and regulations!#Crypto pic.twitter.com/sMi9NkHpcj
— Crypto Hawk (@CryptoKelvin12) December 9, 2025
Hougan also mentioned the argument from some in the crypto community that Bitcoin is the only digital asset that matters.
He said that even with his extensive network in the digital asset space, including VCs, founders, researchers and foundations all regularly discussing ideas with him, he still can’t say with certainty “how things will turn out.”
“At this stage in crypto’s development, I would say it is unknowable,” he added.
Hougan said a combination of factors will determine the outcome of the crypto market. This includes regulation, implementation, macro conditions, the actions of key individuals, luck and a hundred other variables,” he said.
“People who claim certainty are, I think, fooling themselves,” he argued.
Crypto index funds are the only way to capture the full growth of the market, Hougan says
Hougan predicted that the crypto market as a whole “could grow 10 to 20 times its size over the next decade without any effort.”
He added that his “highest belief in crypto” is that the digital asset market “will be much more important in ten years than it is today.”
Hougan then mentioned a recent interview that Paul Atkins, chairman of the U.S. Securities and Exchange Commission (SEC), had with Fox Business. In the interview, Atkins said he expects all U.S. stock markets to go on-chain “within a few years.”
That translates to about $68 trillion in equities, Hougan said, noting that the current tokenized stock market has a combined capitalization of just $670 million.
Tokenized stock market overview (Source: RWA.xyz)
However, he said it will be difficult for investors to spot the opportunities in the market that will drive substantial growth and lead to equally large profits.
“Imagine correctly calling a market that is up 100,000x – and still underperforming because you backed the wrong horse,” he said.
Due to the complexity in the space, Hougan says his investment approach to crypto is to “buy the market.” To do this, he says he invests in market cap-weighted crypto index funds. The Bitwise CIO then makes ‘individual bets around the edges’.
He acknowledged that crypto index funds may not be suitable for every investor. However, he says they are a “great place to start” for many, including himself.
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