Bitwise CIO Matt Hougan believes the market is not fully grasping the significance of Washington’s evolving stance on cryptocurrencies. In a memo dated June 4, he noted that recent positive shifts in US political attitudes toward crypto could have already propelled the market to new all-time highs if properly factored in.

Hougan highlighted how historically, crypto has been a divisive issue, with Republicans generally supportive and Democrats more cautious, as exemplified by Senator Elizabeth Warren's anti-crypto stance last March. Despite this, Hougan pointed out strategic efforts by crypto advocates that have led to significant legislative breakthroughs.

For instance, on May 8, a bipartisan effort in the House repealed SAB 121, an SEC rule restricting large banks from holding crypto, marking a historic legislative win. Further momentum followed on May 20 with the passage of FIT21, a comprehensive crypto bill garnering bipartisan support.

Hougan also noted unexpected moves like the SEC's approval of spot Ethereum ETFs under Democrat-appointed Chair Gary Gensler. Despite recent challenges, including President Biden's veto of the SAB 121 repeal, Hougan views these developments as a turning point.

He emphasized that while regulatory uncertainty remains a concern for financial advisors and institutions, overcoming this hurdle could unlock significant investment potential. Hougan suggested that once the estimated $20 trillion managed by US financial advisors gains clearer access to crypto, substantial capital inflows could follow.

Despite current market indifference to these changes, Hougan sees an opportunity for astute investors, anticipating that the broader recognition of this new crypto era could yield significant investment alpha.