Bitcoin continuing sideways trading despite selling pressures from Michael Slayer's strategy.
Meanwhile, with only 2 days until summer recess, the Clarity Act looks unlikely to be passed this summer.
Now, despite the negative factors, trade acceleration.
2DI continues to pick up steam.
BlackRock launching two tokenized money market funds in Europe, Anilana and ETH.
Now joining me to break this down is Ryan Rasmussen, director, head of research of Bitwise Asset Management.
Ryan, thanks for joining us today.
Great to be here with you.
All right, Ryan, so let's go ahead and get things kicking with the crypto price action now.
The summer months outside of July are typically bears for Bitcoin.
So where do you think the majors stand 10 months into the bear market?
Yeah, that's, that's right.
Typically, summer is a lull for the crypto market.
Actually, historically, September is the worst performing month.
August is not the best either.
So we're headed into this quiet period, but what I think is really important is when you zoom out and look where crypto is and where Bitcoin specifically is over this long-term.
Adoption and investment cycle, we're actually in a pretty good place from a fundamentals perspective, and we're just waiting for price to catch up.
There's a lot of strong tailwinds behind the crypto industry, whether regulatory or institutional adoption or new products coming live.
We just need prices to catch up.
So Ryan, let's talk about the strategy for the time being stacking cash instead of SATs.
Uh, so selling over 6 1000 Bitcoin, do you think it's bullish that Bitcoin has shaken off the selling when or and when will strategy resume buys?
Yeah, absolutely.
I think it's bullish that the market has absorbed the news in the actual sales of Strategy, uh, selling its Bitcoin.
For 5+ years, Strategy was a net buyer constantly of Bitcoin, and then when they sold their Bitcoin for the first time since 2022, earlier this summer, the market did shake it off.
I think that's a pretty massive.
Massive development for the Bitcoin and the crypto market.
I think it speaks to the fact that the industry is maturing from where it was 5 years ago and that new buyers have entered the market via things like ETFs.
It's no longer Michael Saylor and retail investors who are only buying Bitcoin, only buying crypto assets.
You now have financial advisors and the largest Wealth management platforms in the world, turning on access to Bitcoin, Ethereum, other crypto ETFs like the BitW ETFs.
And from there, I think it shows that the market is maturing and changing, and I think that's net positive going forward as a new wave of capital enters the market that's much more massive than strategy or retail investors.
All right, so the big talk of the town in the Bitcoin crypto world is the Clarity Act.
So how important is that to the industry and will it impact uh if it doesn't pass before Congress skips town?
It's the Clarity Act, which is broad market structure, legislation, working its way through Congress that would allow for the crypto industry and investors in the space and companies getting into the space to understand the rules of the road for things like KYC and AML and other elements of operating businesses in the crypto space.
It actually comes from a bill from 2024 that's been making its way.
Through Congress was passed with bipartisan support from the House, but it's been hung up in the Senate.
The, the real window is this week, whether that will pass or not in 2026, in our opinion, before the Senate heads into the summer recess.
Right now, the market odds of that passing are around 14%.
Yesterday, they were, they were 25%.
In February, the odds were 80%.
So, clearly, it's been sliding all year.
In terms of the likelihood of this bill being passed, but I don't think that it's going to pass this week.
And even more so, I don't think that means it's dead in the water.
This is a piece of legislation that's been morphed and adjusted and debated for now over 2 years, and I think whether it passes this year or next year, it will eventually get there.
I would just follow up and say that the SEC has already said They stand ready and prepared to roll out rules in place of the Clarity Act to help the industry know how to proceed and how to support the crypto industry going forward.
So, I don't think it's the end-all be-all or this, you know, giant rain cloud over the crypto industry if it doesn't pass.
I actually think it's positive that we churn through this period of uncertainty of it, will they, won't they?
And we are able to move forward as an industry.
So, let's talk a little bit more about the institutional rush into blockchain.
Now, BlackRock launched two tokenized money market funds in Europe on Solana and Ethereum.
So, what exactly are you watching?
The tokenization space is such an interesting space for crypto.
It has a massive addressable market and it's just getting started.
I know at Bitwise when we talk to professional investors, whether they're financial advisors or family offices or ultra-high net worths or corporations, all of these firms and investors are excited about the wave of tokenization, and that's because it impacts every corner of the financial industry.
Of course, when we talk about tokenization, we talk about Taking stocks and bonds and other traditional assets and bringing them on the blockchain-based rails.
The reason that's such a fundamental shift and a huge innovation to the financial industry is because it lowers the cost of trading and transacting.
It reduces inefficiencies in the market around settlement, around risk.
It's how we introduce things like 24/7, 365 trading, which, of course, the New York Stock Exchange and the NASDAQ are focused on doing.
And so token. ization is a massive trend and massive tailwind for the crypto industry.
We're really excited about it at BitW.
It's one of the key ways that we'll see crypto integrate into the mainstream financial world.
And I think 10 years from now, when you look back, you won't be talking about, does this trade on a blockchain, does this trade on traditional rails.
I think we're seeing the convergence of the traditional financial industry and cryptotechnology in things like tokenization and Solana, as you mentioned, Ethereum.
Hyperliquid.
These are some of the leading blockchains in the tokenization trade and in the tokenization trend.
Stocks are trading on Solana at record highs.
Oil futures before the SpaceX IPO, the pre-IPO shares were trading on things like hyperliquid.
These are blockchains where this activity happens, and so we're massively bullish on that type of adoption and usage translating to these blockchains and their underlying crypto assets.
All right, so Ryan, so you also tried crypto equities like Coinbase.
So after seeing their earnings report last week that sent the stock lower.
So what's your outlook for crypto equities?
I'm so bullish on crypto equities over the long term.
These are the companies that are publicly traded, whether they're Bitcoin miners or exchanges like Coinbase or stablecoin issuers like Circle and tokenization platforms.
These are the publicly traded companies that are building the infrastructure or the picks and shovels of the crypto industry.
We have an index that BitW is the 30 leading crypto equity companies and it's been performing pretty strongly.
This year, actually relative to the crypto space, it's up 20% or so this year, while Bitcoin and other cryptos are down 25% or more, and I think that speaks to, the ability to get access to crypto through a diversified index, but also these different tailwinds we've spoken about.
Crypto equities really benefit from stablecoins and tokenization.
You have Bitcoin miners, which are benefiting from the AI trade as they repurpose some of their data center and. power to the AI boom, and then you have stablecoin and tokenization issuers who are set to benefit from these massive mega trends behind stablecoins and tokenization.
So, our outlook for crypto equities is very strong.
We view it as part of the overall crypto portfolio construction.
Investors want crypto assets, but they also want the publicly traded crypto companies that are building the infrastructure to help connect these worlds.
Also more Ryan from BitWise, thank you so much for joining us today.
Thanks for having me.
