Bitwise Chief Investment Officer Matt Hougan has identified striking similarities between the current explosive rally in precious metals and historical cryptocurrency altcoin seasons. According to Hougan, both phenomena are driven by a "wealth effect" where profits from primary assets spill over into secondary markets in search of greater returns.
Gold has surged 80% over the past year, approaching the $5,000 per ounce mark with an estimated market capitalization of $34 trillion. Meanwhile, silver has experienced a staggering 228% increase, breaking above $100 per ounce for the first time on Friday, January 23, 2026, with its market cap reaching an estimated $5.6 trillion.
"What you're seeing in these other metals like silver is just a classic altcoin cycle in metals," Hougan told Decrypt. "They made money in gold, now they're going out the curve." He explained that in any bullish market, massive wealth creation inevitably spills over into adjacent, smaller markets, causing parabolic price movements.
This dynamic mirrors the cryptocurrency market behavior observed during previous bull cycles, where investors who profited from Bitcoin would rotate capital into Ethereum, Solana, XRP, and eventually into more speculative assets like NFTs. Hougan noted that Ethereum, Solana, and XRP are collectively valued at $453 billion, making them more susceptible to price swings than Bitcoin, which currently commands a $1.8 trillion market cap and 58% dominance.
Separately, Tom Lee, Chairman at BitMine, has characterized the precious metals surge as a leading indicator for Bitcoin. Lee pointed to the mean reversion principle, suggesting that Bitcoin's current lag behind gold and silver—which have benefited from global geopolitical tensions—will eventually correct as capital rotates into digital assets.
The next phase for cryptocurrency markets may be influenced by regulatory developments, particularly the expected approval and enactment of the Clarity Act in the United States, which analysts describe as a major bullish trigger for 2026. Institutional capital rotation is already underway, with BlackRock's IBIT recording net cash inflows exceeding $5 billion since the beginning of 2026.
