The Rundown - How Tokenization Could Change Stock Trading Forever (ft. Matthew Hougan)

Episode Date: September 20, 2026

Bitwise CIO Matt Hougan joins Zaid Admani to explain why tokenization could bring the biggest change to stock trading in a century. He breaks down how investors could soon trade stocks around the clock with nearly instant settlement and why everything from real estate to Pokémon cards could eventually move onto the blockchain. Hougan also explains why major banks pushed back against the Clarity Act and what its failure means for crypto regulation. Plus, he makes the case that Bitcoin’s ability to rally through bad news is a powerful signal of strength. The conversation explores what could drive crypto’s next major bull market and whether Bitcoin is finally beginning to behave like digital gold.

Welcome back to the rundown interview edition. Today, I am talking to Matt Hogan, the chief investment officer at Bitwise, one of the largest crypto-focused asset managers in the world. And Matt is joining us at the perfect time because this was a big week for crypto and we got into it all. Matt explained why he thinks the Clarity Act failing in the Senate won't be a huge setback for crypto. He also explained why the new exemptions by the SEC for stock tokenization is a big deal.

and other reasons to be optimistic about crypto moving forward. This was an awesome conversation. I think you guys are going to really enjoy it. So let's get into it. All right, guys, today we are talking to Matt Hogan, the CIO of Bitwise, one of the largest crypto-focused asset managers in the world. Matt, welcome to the rundown. It's amazing to be here.

Thanks for having me. Well, I'm so happy you could join us this week. It was a big week for crypto, I got to say. There's a lot happening. I want to start with the Clarity Act. That was like the main headline this week, the Clarity Act, did not, it failed to advance in the Senate this week. I just want to get your take as someone who follows this stuff all the time. How big of a setback is this for the crypto industry?

Because for the last year, so I've just been hearing nonstop, you know, buzz and hype around the Clarity Act. And if it's going to get done, doesn't get done. Now where does that lead the crypto industry? Yeah, it's a great question. It depends on your time frame. That's why it's a little bit frustrating. So the reason we wanted clarity is because legislation is hard to change. So if you think about the history of crypto over the last like seven or eight years,

we had a very anti-crypto SEC led by Gary Gensler. And then we have today a very pro-crypto SEC led by Paul Atkins. And in the anti-crypto SEC, it was hard to get things done. It was hard to launch an ETF. It was hard to have big institutions move into crypto. It was challenging for the price. In the pro-crypto SEC that we're in now, it's easier to get things done. We have a large variety of ETFs.

We have regulated futures. You see BlackRock and NASDAQ and NISI building on crypto-based rails. What the Clarity Act was about was putting in place legislation that would last multiple administrations. They couldn't be overturned by a change in the SEC. So that's what makes this moment so interesting because the reality is with the Clarity Act failing, the people setting the rules for crypto are the SEC and the CFTC who are very pro-Cropto. So for the next two and a half years, we're going to have very pro-crypto rules. But the worry is what happens in two and a half years.

So it's sort of timeline dependent. It's we're in a great place now. If we had clarity, we would have been in a great place forever. Now we're in a great place, but with some uncertainty in the future. And that what makes it interesting to be an investor in crypto right now. Right. So like it, you were trying to lock in some certainty in some like, you know, without having the rules changing every two to three years. on based on who's in the White House.

Now there's that uncertainty again, depending on who's in charge of the SEC, CFDC, in two and a half years. You got it. That's exactly right. It's all about certainty versus uncertainty. Make no mistake, it would have been better if it had passed. I think if it had passed, crypto would have been the consensus hot trade in the fourth quarter of this year.

It would have been a runaway bull market. Now, I still think the situation is pretty good for crypto. But as you said, there's more of this downstream uncertainty that we just going to have to wrestle with as an industry. Well, I saw that, you know, you said before the vote that you were less worried about its failure than you were earlier this year. Like, you still thought that it wasn't going to pass, but you weren't as concerned about it not passing anymore. What changed between, you know, everyone was wanting it to pass and how it was so important for crypto and then now not being as worried about it? Yeah, there are two things. Great question. The first was that the

market priced it in failing, right? Going into the vote yesterday, before there was this little blip up, market had, if you looked at polymarket or Calci, the odds of it passing had fallen to like 15%. If it's already priced in as failing, who cares if it fails, right? It's not going to impact price. The other reason was the SEC and the CFTC were just very aggressive about saying, we will fill the hole if this thing fails. I think chair, Paul Atkins of the SEC went on CNBC and said, we're ready, willing, and able to pass rules that cover what clarity would have covered. So when I looked at it, I was like, well, look, it's already priced in. We're going to have a pro-crypto SEC.

And my guess, and this is probably the most important point, my guess is after two and a half years of growth, it'll be too big to put crypto back in the bottle. We may not get the same level of SEC support in the next administration that we have today, but we're not going to go back to the Gensler era because BlackRock's going to be in it and Goldman Sachs is going to be in it

and NASDAQ is going to be in it, and NISY is going to be in it. We would have gotten escape from it. It's kind of how Uber was quasi-legal, but then everyone was using it, and the regulators couldn't put it back in the box. I think the same thing is going to happen to crypto over the next two and a half years. That's a great point. I guess the only pushback there would be there's, so a lot of, you know, traditional financial institutions are on board. You mentioned Black Rock and others, but you still have some of the big, you know, big banks.

I think J.P. Morgan was one of them. A lot of regional banks that came out against this. They were, they were very against it. Can you kind of explain to the audience why they were so against this act passing? Yeah, well, look at your checking account or your savings account. Look at the interest that you're getting on those checking and savings account. That's why they were against it. The average checking account today plays one basis point.

That's 0.01% of interest. What the big banks were worried about was you had this new technology that could disrupt the status quo. Maybe stable coins, which are digital dollars issued on blockchains, maybe they could pass interest. And if I can pull out my phone and get 5% interest with the push of a button, instead of 0.1% interest in my checking account, well, that's a little bit scary. So look, they said they were worried about deposit flight, draining banks, making it hard for them to lend.

I don't buy it. I think they were worried about profit flight. They've had this sort of beautiful monopoly on people's money. Crypto is a challenge to that. And so they were trying to make it difficult for that technology. to win out. Ultimately, new technologies win out. Ultimately, what's easier, better, cheaper, more profitable for investors is what wins. But for sure, the banks were trying to push back against it. And I guess in a sense, they won. But now they have to wrestle with the fact, as I mentioned earlier,

that we have a pro-crypto SEC. So we're going to gain a lot of ground anyway. Well, I want to talk about the pro-c crypto SEC. They made some major headlines this week. they have a new exemption, the five-year innovation exemption that will allow tokenize U.S. stocks to trade on-chain here in the U.S. Now, that sounds like a lot of buzzwords there. Can you explain what this really does? And like, is this a big deal and how big of a deal is it? Yeah, it's a massive deal. This is going to be the biggest change in how we've traded stocks in our lifetime. I think the place to start is just explaining how goofy the existing system. is. Like think about the world that you exist in. You have driverless cars. You have Amazon will deliver anything to your door in an hour. When you go to trade a stock, basically you can trade

at 930 to 4 Monday to Friday, not on holidays. If you sell a stock, it takes one day to settle, which means unless you have a very favorable brokerage arrangement, you can't get your money out for 24 hours. A hundred years ago, guess how long it took a stock to settle? It took one day to settle. We've made no progress in 100 years. Okay, so what's a tokenized stock? What you do with a tokenized stock is you take a normal stock and you put it at a custodian and then you issue a certificate on a blockchain that represents that stock, right? You could tokenized invidia, tokenized Tesla. What changes a lot? Suddenly you can trade it 24-7, 365. Suddenly it doesn't take nights or weekends off. Everyone around the world can trade it. And if you sell it, it settles not in a

but in a second. So if you have to like make a down payment for an apartment or buy a car and you need the money, you can sell a stock and you have the cash instantly instead of waiting for that day, I think and the chair of the SEC thinks and the CEO of BlackRock thinks and the CEO of many other financial institutions think all stocks are going to be tokenized in the next five years. And so we're going to be in 24-7, 365 trading. We're to be in global trading, and this was the first time that the SEC put in place rules that would let Americans interact with these tokenized stocks. So I really think it was a signal moment. I think we'll look back at it as like there was the pre-tokenization era, and now there's the tokenized

era, and they're going to look completely different. It's pretty exciting. So it's essentially changing the plumbing of how the markets work, right? And I think what made me feel a little bit better about this was like there's a tokenized stock will still represent like the same rights as just owning the normal style because before I was like so what's the point of having a tokenized stock is it just for DGEN traders that want to buy Nvidia at 2 o'clock in the morning but no it does faster settlement and there's like there's benefits to like the plumbing of like how it all works that's exactly right yeah it's the same stock that was the important thing in this innovation in this exemption the SEC put in place it's the same stock with the same dividends and the same voting rights

and the same rules. It's the same thing. It's just as you said, the plumbing. If you were trading stocks in like the 1980s, they were trading on the floor of the New York Stock Exchange, right? Like big, burly linebacker guy is shouting and raising their hands. That was how Chalks trade. And then, of course, with a digital revolution, they just started trading on computers. And now all that happens on the floor of the exchange is people record videos and TV shows, right? So that's an example of how the plumbing of trading can change. This is just the next iteration of that. This is a better, faster, global 24-7 iteration. But as you said, it's the same stocks. It's just 24-7-365, and it's instantaneous settlement instead of one-day settlement. It's underlying the plumbing. I think it's pretty

exciting, though. Why shouldn't stocks exist in the internet age? Why are we still trading stocks effectively the same way we were in the 1930s. It seems completely ridiculous. The only pushback I'll have is that someone who does this for a living now. I mean, 24-7 stock trading, I kind of like the fact that I could just, you know, log off at, like, 6 p.m. and not have to worry too much. But now it's, now I'm on 24-7. I feel you, man.

I haven't slept in eight years. I guess that's the only downside is for people like us. Like, now it's like, well, now I've got to follow all the activity happening in the after-hours. Because there is no more after-hour. It's 24-7. It's true. It does change a lot, actually. You know, you think about something like earnings events. We have a day to think about what that earnings events means. Sure, you could trade after market hours. But basically, the market doesn't react during the earnings call. Now you're going to see the same amount of volume on every word that the CEO is saying. It does really change things. So, yeah, I mean, our nights and weekends are gone. It's sad. But you are going to have, you won't have this sort of period of rest and recovery every day. So it does change the dynamic of the market. I am curious to see how it's all going to interact,

like how are traditional stock or like the normal stock's going to interact with the tokenized versions? Like what if like there's a spike in volatility in the tokenized version, the price starts deviating? Maybe there's, maybe that's all been worked out and it's not a problem. But those are some of the questions that I have in the back of my mind. Oh, I think that's a really good thing to raise. And actually if you look at it today, you know,

they generally track each other, but it's not perfect. So over time, you're going to get the Jane Streets of the world and the large market makers, and they're going to arbitrage between this and that. But for the first period, you should be buyer beware because you may be paying too much for this stock, or maybe you're getting a discount for this stock. It's not going to work perfect. Nothing works perfectly out of the gate. So there is going to be this gap risk.

And over time, the arbitrage areas will figure that out. But there'll be a period where it really will be buyer beware. So it's a good call out. Do you see this tokenized movement happening to other assets? Are we going to be having tokenized real estate? Are we going to have tokenize Pokemon cards? I mean, is that just like what the trends are moving forward? tokenized everything.

So if you go into the Dgen corners of crypto, right? If you're trading on offshore exchanges, you're already trading pre-IPO shares of Anthropic and OpenAI. We're not waiting for the IPO. We have digital representations of those shares that are trading at size in that market. You can tokenize bonds. You can tokenize commodities. You can tokenize real estate.

You can tokenize Pokemon cards. You can tokenize anything. And that's what we see in the crypto world. And the amazing thing about it, for good or for bad, is that they all trade in the same space. Even today, if you take something like bonds and stocks, it's not always easy to trade bonds in the same way you trade stocks. Some of them, you need to be able to call a broker,

literally with a phone. It's like the 1990s. In this tokenized world, all of those assets will trade side by side. You'll be able to margin one against the other. And yeah, it will extend beyond just stocks and bonds to private stocks to Pokemon cards. It's going to be a weird financialized world. I know there's some people who don't like that. I agree that there are some risks in that.

But I do think it's something close to inevitable. So I do think that's the world we're moving towards. Well, it's going to be really interesting. five-year period now that this is, you know, not that the SEC has granted this exemption. So really curious to see how this plays out. I want to wrap up with just a big picture view on crypto. It's been like a really weird year. You know, last October, Bitcoin hitting all time highs, 124,000, 125,000. Then we kind of had a lull this year. I mean, Bitcoin was trading like in the $60,000 range. Then we got a jolt of energy in August, like up 25% out of nowhere.

I think maybe there was some, you know, hype around the Clarity Act getting passed. Where do you see this going. Now that like the clarity stuff is kind of behind us. We have interest rates going up. The Fed just raised a quarter point. They're they're projecting them to raise more. Yields are surging. What I always think about is like what what era is Bitcoin in right now? Is it in the tech stock era where it acts as a tech stock or is it actually going to start becoming digital gold where some people thought, you know, it's a hedge against inflation and you know it's part of the debasement trade. So where do you see it all going? Yeah, yeah. The uncomfortable thing there is my teenage son. Like, is he an adult or is he a kid? He has aspects of both. He'll do something

totally insane, and then he'll do some complicated calculus that I couldn't do. So that's a little bit where Bitcoin is. It's somewhere in the middle. I think Bitcoin specifically will start looking more and more like gold. I think people are more and more concerned about debasement and debt. I think that's going to be a focus. One of the reasons we rallied in August was because Treasury Secretary Scott Besson intervened in the long end of the yield curve, and people took that as a sign that the government was going to put its foot on the Treasury and monetary markets, and it responded by spiking gold and spiking Bitcoin. I think that's what we're going to see.

More broadly, I'll tell you, I feel very good about crypto right now for one specific reason. My biggest tell on something that's in a bull market versus a bear market is how it reacts to bad news. In a bear market, you get like a little trickle of bad news. There's like one gray cloud on the horizon and the price tanks. And that's where we were for the first part of this year. There'd be like some minor setback in crypto and we'd be down 5%. It was brutal to live through. But you just mentioned this week we had the Clarity Act fail.

We had interest rate spike. We have oil over 100. We have multiple straits in the Middle East being closed. We have AI dumerism, people talking about extinction events. Crypto is rallying. And when you see an asset that's rallying in the face of bad news, that means there's a lot of good things going on underneath the force it to overcome things. People are looking at these things like this tokenization trend,

and they're saying, yeah, interest rates make this challenging, but this is such a bullish trend that we're going over. it. So when you're impervious to bad news, which is where we are in crypto right now, maybe we won't be next week. You should monitor this. When you're impervious to bad news, that's a really good sign that there's a lot of strength. So I think it could be a very good end of the year for crypto. That makes me pretty excited. You know, what I worry about or what I think about is like, where's like the excitement coming from? Because, you know, just rewind a couple years. Like there was excitement around a Bitcoin ETF and a crypto ETF. We got that.

There was a nice build up to that. Then we had a crypto-friendly administration come in. There was excitement around that. And then there was hype around a potential clarity act. And so now I'm like, where does it all, where does the excitement? Where does like the media attention come from now? What is it going to be driving it? Because right now, at least for this year, all the excitement has been about AI

and the AI-related stocks. And that's kind of taken away some of like the excitement from just casual retail investors. That's kind of how I consider myself in crypto. casual follower of crypto, gradual investor in crypto. So it's like, where does the excitement come from? What are people going to get excited about? So my mom is asking about crypto and Thanksgiving, you know? Yeah, yeah, yeah, yeah. I hear you. I think you're more pro than you're letting on, but I'll give you the casual retail investor. There's going to be three things. So this example of the SEC announcing this tokenization exemption, that's just one of probably 10 regulatory

headlines that are going to hit between the end of this year. You're going to have the SEC or the CFTC talk about perpetual futures, which are futures that trade on crypto exchanges, which could supplant traditional futures markets. That will come out. We're going to have a series of these regulatory announcements. So just like the tokenization thing has us talking about how stocks could change, we're going to have the same conversations around stable coins, around futures, around options, around private companies. I think you're going to get a series of those events. The second thing I think you're going to see that maybe we'll penetrate the Thanksgiving table, is major M&A activity or announcements from big firms.

Right? So when you see something like MasterCard buying a stable coin firm for $2 billion, which is something that happened recently, that's a sign that maybe there's something going on. Yesterday, Patrick Collison of Stripe, probably the most respected fintech in the world, made a post about the huge growth in stablecoin use from AI agents. When you have people like that saying,

look, there's something happening here, I think that's a little bit of a job. of energy. And then the last thing is just price. I know that this is a reflexive circular argument, but when price dose to go up, people start talking about it. I just mentioned that what I see in the market today is that the crypto-native market doesn't care about bad news. They think we're in this stable coin tokenization super cycle. If we start to see Bitcoin get back towards $100,000 because of some of these catalyst, then I think, you know, maybe you won't sound so crypto-crazy to bring it up at Thanksgiving, and maybe your mom, your dad, your uncle will be asking you about

crypto toward the end of the year. Well, I'm looking forward to it. Matt, this was fantastic. I really appreciate you breaking it down for me in the audience. And do you have anything to plug? No, I mean, that's it. Bitwise is a full service asset manager. We'd love for you to come and go and look at it. More than that, come follow our content. We produce a weekly memo on crypto. I promise it's short. It's 500 words. You can find it at Bitwise. Bitwise is CIO memo. And it gives you an institutional view what's happening. But mostly just appreciate the time. This has been a lot of fun.

Of course. Thank you again for your time. And we'd love to have you back on. Thanks, man. Have it going. Well, all right, guys, hope you enjoyed that conversation with Matt Hogan. I thought this was a really interesting one.

I think Matt did a great job providing a balance, yet optimistic view on where crypto is and where it's headed. And I'm really curious to see how the rollout of Tokonali stocks goes in the U.S. And what kind of adoption it gets here. By the way, as we were recording that conversation on Friday morning, Bitcoin started to rally. And like Matt said, the fact that it's rallying even after the bad news this week could be a sign that Bitcoin is starting to act as digital gold again. Let me know what you guys thought about this conversation. Is crypto still a part of your portfolio?

Are you more or less bullish now? And how do you feel about the tokenization of stocks and potentially other assets? Drop your thoughts, the comments on Spotify and YouTube. And while you're at it, consider giving us a five-star rating as well. You know, all that engagement really does help us out. other people find the show. And if you're a new listener, just a heads-up, we post every single day throughout the week breaking down what's happening in the market. So definitely get subscribe if you haven't already, especially with everything going on right now. Thank you guys again for listening, watching and commenting. Shout out to Mike for all the work behind the scenes. And we'll see you guys back here tomorrow.

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