What I Learned This Week From 40 Financial Advisors

They’re still very interested in crypto, just not in all the ways you’d expect.

I did eight sales calls with financial advisors on Monday. It was the most I’ve done in a single day since I joined Bitwise eight years ago. Since most of these meetings were with teams and not individuals, I spoke with more than 40 advisors in a single day.

I learned two important things:

1) Advisors are still interested in crypto.

2) They are more interested today in stablecoins and tokenization than they are in bitcoin.

Those are fairly simple takeaways, but they say critical things about what to expect in the coming months. For this week’s Memo, I thought I’d drill a little deeper into these conversations.

Advisors Are Still Interested in Crypto

This is the most important takeaway. Throughout crypto’s history, new bull market cycles have relied on a combination of new product breakthroughs and new types of investors.

What brought us out of the 2014 bear market? The launch of Ethereum and the entry of the first crypto-curious retail investors.

What brought us out of the 2018 bear market? DeFi Summer and the entry of Covid-era investors ready to spend new stimulus checks.

What brought us out of the 2022 FTX debacle? Progress on bitcoin ETFs and the entry of mass retail and hedge fund investors.

I’ve been thinking a lot about what will drag us out of the 2026 bear market. The uptake of new products is an obvious potential catalyst, with stablecoins, tokenization, perpetual futures, and other real-world applications of crypto starting to take off. But for real escape velocity, we need mass adoption by a new investor class. The best hope in my view is financial advisors and institutional investors—many of whom still face hurdles to accessing crypto exposure. The fact that they remain interested despite the pullback is good news.

Stablecoins + Tokenization > Bitcoin

The second takeaway was even more interesting: Their eyes are on stablecoins and tokenization more than bitcoin.

Bitcoin has always led crypto out of previous bear markets, largely because it is the biggest and most established asset. And I personally find today’s prices around $60k incredibly attractive for long-term investors, so maybe it will lead us out of this one as well.

But it was pretty hard to engage with advisors on bitcoin this week. In call after call, they expressed much more curiosity over the real-world applications of crypto that are quickly reshaping everything from capital markets to global payments. The reason, I think, is twofold. On the one hand, the fiat debasement trade has receded from investors’ minds generally—gold, for instance, is trading down 20% from its all-time high. At the same time, stablecoins and tokenization have taken center stage. It’s hard to turn on CNBC and not hear someone like SEC Chair Paul Atkins or Goldman Sachs CEO David Solomon or BlackRock CEO Larry Fink talking about stablecoins and tokenization. Investors want to be a part of that.

If you think financial advisors are the marginal net buyer of crypto in the next cycle, the first place money would flow might be into stablecoin- and tokenization-linked investments. That means assets like Ethereum (ETH), Solana (SOL), Canton (CC), Chainlink (LINK), and Avalanche (AVAX), all of which came up on Monday. It might be into next-gen tokens with sophisticated trading applications like Hyperliquid (HYPE). Or it might be into crypto companies like Figure (FIGR), Circle (CRCL), and Coinbase (COIN).

Sometimes, the best way to find out what’s going on in the crypto market is just to talk to people. The discussions I had this week reinforced for me that advisors—a group that collectively manages more than $175 trillion—have a much broader and more nuanced view of crypto’s potential than they did even two years ago. That’s a big deal.

It might also be the thing that leads us into the next bull market.

Risks and Important Information

No Advice on Investment; Risk of Loss: Prior to making any investment decision, each investor must undertake its own independent examination and investigation, including the merits and risks involved in an investment, and must base its investment decision—including a determination whether the investment would be a suitable investment for the investor—on such examination and investigation.

Crypto assets are digital representations of value that function as a medium of exchange, a unit of account, or a store of value, but they do not have legal tender status. Crypto assets are sometimes exchanged for U.S. dollars or other currencies around the world, but they are not currently backed nor supported by any government or central bank. Their value is completely derived by market forces of supply and demand, and they are more volatile than traditional currencies, stocks, or bonds.

Trading in crypto assets comes with significant risks, including volatile market price swings or flash crashes, market manipulation, and cybersecurity risks and risk of losing principal or all of your investment. In addition, crypto asset markets and exchanges are not regulated with the same controls or customer protections available in equity, option, futures, or foreign exchange investing.

Crypto asset trading requires knowledge of crypto asset markets. In attempting to profit through crypto asset trading, you must compete with traders worldwide. You should have appropriate knowledge and experience before engaging in substantial crypto asset trading. Crypto asset trading can lead to large and immediate financial losses. Under certain market conditions, you may find it difficult or impossible to liquidate a position quickly at a reasonable price.

The opinions expressed represent an assessment of the market environment at a specific time and are not intended to be a forecast of future events, or a guarantee of future results, and are subject to further discussion, completion and amendment. The information herein is not intended to provide, and should not be relied upon for, accounting, legal or tax advice, or investment recommendations. You should consult your accounting, legal, tax or other advisors about the matters discussed herein.