Bitwise Asset Management Chief Investment Officer Matt Hougan has challenged the prevailing narrative that Layer 1 blockchain blockspace has become a commodity, arguing that institutional behavior tells a different story. In a detailed analysis, Hougan pushed back on the "increasing view in crypto that L1 blockspace is a commodity," noting that if infrastructure were truly commoditized, capital and development would be evenly distributed. Instead, he observed that the vast majority of institutional building is concentrated on very few chains, with "basically, zero interest in building on the twentieth largest L1."
Hougan identified Ethereum (ETH) and Solana (SOL) as the dominant networks, continuing to lead in mindshare, liquidity, and developer activity despite aggressive competition from newer L1s on fees and throughput. He explained the current low-fee environment by stating, "Top-tier L1s built more bandwidth than the market can use at the moment, so fees are rock-bottom." However, he cautioned that this equilibrium may not last, posing a critical question: "The real question is what happens when demand scales as stablecoins/tokenization/DeFi grow into the trillions. I’m not sure we know the answer yet." Hougan suggested that if blockchain-based financial infrastructure expands to support trillions in tokenized assets, today's excess capacity could tighten, potentially reshaping the economics of leading networks.
Separately, in an appearance on the When Shift Happens podcast, Hougan named four cryptocurrencies as essential core holdings for the 2026 market cycle, dubbing them crypto's "Mount Rushmore." His picks emphasize structural pillars over speculative trades:
Bitcoin (BTC): Described as the "only clear winner" in the store-of-value category, with the competition for the "digital gold" narrative effectively ended. Hougan views its current price—trading more than 40% below its October 2025 all-time high near $126,000—as a long-term accumulation opportunity.
Ethereum (ETH) and Solana (SOL): Recommended as a basket, characterized as high-upside infrastructure plays positioned to benefit from continued growth in stablecoins and tokenization. The thesis centers on network utility and institutional adoption.
Chainlink (LINK): Referred to as the "sleeper pick" of the group, with its value proposition tied to oracle infrastructure—the critical data layer for real-world asset tokenization and institutional blockchain applications.
Hougan also outlined a broader market outlook, assigning a 10–25% probability to the possibility of active sovereign Bitcoin purchases by the U.S. government, a scenario in which Bitcoin could rapidly reprice toward $500,000. He argued the traditional four-year halving cycle may be losing relevance, replaced by macro liquidity trends, and sees Bitcoin potentially reaching $200,000 in 2026 if conditions improve. Bitwise estimates that as much as $180 billion in capital from pensions and wirehouses could enter crypto markets by the end of 2026, driven by ETF adoption and regulatory normalization.
