Bitwise's chief investment officer, Matt Hougan, believes that regulatory clarity in the United States could open up the crypto market to the $20 trillion financial advisory industry. According to Hougan, regulatory uncertainty has been the primary reason financial advisors have hesitated to invest in crypto over the past five years.

In a June 4 post, Hougan expressed optimism that the U.S. is moving towards clearer regulations, which could significantly impact the crypto market. "Imagine how much of that $20 trillion will go into crypto when the biggest barrier gets lifted," he said, emphasizing the potential influx of investment once regulatory issues are resolved.

Hougan pointed out that recent political developments indicate a shift towards more favorable crypto regulations. He highlighted the bipartisan effort to repeal Staff Accounting Bulletin 121 and the passage of the Financial Innovation and Technology for the 21st Century Act (FIT21) in the House as significant steps forward. Additionally, the Securities and Exchange Commission's (SEC) approval of spot Ether exchange-traded funds (ETFs) on May 23, after much speculation, marks another positive development.

However, Hougan noted that despite President Joe Biden's veto of the SAB 121 repeal, which he sees as a minor setback, the overall momentum is positive. He believes that the crypto market still faces challenges but is optimistic about the future. "We've been sailing upwind for a decade in crypto," he added.

Hougan also emphasized the potential for substantial gains ("alpha") in the crypto market, which he believes remains largely untapped by traditional financial players. He noted that many in the financial industry still do not fully grasp the implications of recent political shifts in Washington D.C.

Despite the positive developments, Hougan acknowledged that significant policy changes have yet to materialize. "The tide has changed, but the water hasn’t come in yet. Wake me up when the action happens," he concluded, underscoring the need for concrete regulatory actions to fully unlock the potential of crypto investments in the financial advisory sector.