With our good friend Dave Nadig (CIO and Director of Research at ETF Trends) as co-host, we had the pleasure of speaking with Matt Hougan, CIO of Bitwise Investment, which manages the world’s largest crypto index fund. A veteran of the ETF industry, Matt brings institutional gravitas to a nascent sector and has recently authored the CFA Institute’s curriculum guidelines for digital assets. Our conversation included:

• Crypto as a currency looks highly unlikely to succeed, but as a technological advance it is highly unlikely to fail
• One of the most interesting problems in the space: very few people actually understand blockchain technology and its multifaceted capabilities
• The biggest risk in digital assets is behavioral
• Why market-cap weighted may be quasi optimal – size matters in a sector driven by network effects
• The delusional notions of Bitcoin replacing the USD
• The crucial importance of frequently rebalancing a portfolio that holds highly volatile assets
• A shifting zeitgeist and the typical question – from “will it go to zero?” to “what is a reasonable weight range?”
• Why UniSwap may be the greatest entrepreneurial story of the past decade

We also discussed DeFi (Decentralized Finance), technological updates and the excitement around the Ethereum ecosystem, tax implications and much more. A big thanks to Dave Nadig, not only for the introduction to Matt and co-hosting the episode, but for flexing his healthy skeptical muscles and pushing back at times – it made for great entertainment!

Thank you for watching and listening. See you next week.

 

This is “ReSolve’s Riffs” – live on YouTube every Friday afternoon to debate the most relevant investment topics of the day, hosted by Adam Butler, Mike Philbrick and Rodrigo Gordillo of ReSolve Global* and Richard Laterman of ReSolve Asset Management.

 

*ReSolve Global refers to ReSolve Asset Management SEZC (Cayman) which is registered with the Commodity Futures Trading Commission as a commodity trading advisor and commodity pool operator. This registration is administered through the National Futures Association (“NFA”). Further, ReSolve Global is a registered person with the Cayman Islands Monetary Authority.