Bitwise CIO sees $555 million ETF inflow as Bitcoin surges

Matt Hougan, Chief Investment Officer at Bitwise Asset Management, has shared insights on the recent sharp rise in Bitcoin’s (CRYPTO:BTC) price, attributing it to growing investor anticipation.

In a memo titled “Crypto Is Not Going To Wait for the Election,” Hougan analysed the current momentum in the cryptocurrency markets, highlighting factors driving the surge.

According to Hougan, Bitcoin surged over 5%, while Ether (CRYPTO:ETH) experienced a 7% rise, marking the most notable one-day gains in nearly two months. 

He attributed part of this rally to a recent plan unveiled by Democratic presidential candidate Kamala Harris. 

The proposal, which outlines a regulatory framework for crypto, sparked strong investor reactions. 

Hougan stated, “People don’t want to be left behind if and when crypto takes off,” emphasising that the market remains highly responsive to even minor developments.

The announcement led to $555 million flowing into Bitcoin exchange-traded funds (ETFs) on Monday, the highest inflow observed in four months. 

Although Harris’s proposal generated significant buzz, Hougan described it as more symbolic than transformative, comparing it to a “Rorschach test” reflecting different views within the regulatory debate. 

Despite this, he acknowledged its impact on market sentiment and momentum.

Hougan noted that even slight positive news could drive significant price action in the crypto sector. 

He remarked, “That little sliver of good news was enough to send bitcoin up 5%. Enough to push more than $500 million into bitcoin ETFs.” 

This observation points to substantial capital awaiting favorable regulatory signals to re-enter the market.

Discussing Bitcoin’s future price movements, Hougan referenced a previous forecast suggesting that political outcomes, like a GOP victory or a divided administration, might drive the next major rally. 

However, he has adjusted his outlook, stating, “After today, I’m not so sure. Monday’s rally tells me people don’t want to be left behind if and when crypto takes off. There is a lot of dry powder on the sidelines. As soon as we get any whiff of clarity, I think we go higher fast.”

Based on Hougan's analysis, the recent price gains illustrate how regulatory developments, even those primarily symbolic, can spark significant investment activity, underlining the market’s sensitivity and investor optimism.

At press time, the Bitcoin (BTC) price was $67,041.48.