Bitwise’s next bull market projection: a major integration of on-chain finance, with Hyperliquid and Robinhood as key barometers of direction

Author: Matt Hougan, Chief Investment Officer at Bitwise

Translation: Jinse Finance Claw

Cryptocurrency is finally showing signs of a bottom. Since July 1, Bitcoin is up 9%, while the Nasdaq 100 index is down 6%. ETF capital flows have turned positive, and market sentiment is improving. While it’s still too early to declare a full market recovery, the current signals are encouraging enough that I’m starting to get questions about what happens next.

Last Friday, an investment advisor asked, “If the crypto market has already bottomed, what will trigger the next bull run?”

Typically, this question can’t be answered during a crypto winter. The next bull run is usually only obvious in hindsight.

But this time, I think the answer is right in front of us: the next crypto bull market will be the result of the merging of on-chain finance and traditional finance.

In other words, I believe future developments will center on stablecoins, tokenization, 24/7 trading, instant settlement, and the expansion of institutional-grade DeFi to the trillion-dollar scale—and it will disrupt the financial industry the way the internet disrupted media and shopping in the early 21st century. I expect this to be the largest cycle so far, for two reasons: first, it will be the most real—driven by utility and returns rather than hype; second, it will challenge a bigger market than any prior cycle (global finance, not just crypto).

Some people will say this is obvious. Tokenization will surely lead the next bull market. Stablecoins will surely expand to the trillion scale. Wall Street will surely go fully on-chain. After all, crypto has many advantages compared with traditional finance: 24/7 service is better than 9-to-5; instant settlement is better than T+1 settlement; and global reach is better than localization. And this isn’t just my view. The U.S. SEC Chair, the CEO of BlackRock—the world’s largest asset manager—and the CEO of JPMorgan—the world’s largest bank—agree.

However, even if it seems obvious, most investors are not yet prepared for it. Most are still questioning whether crypto is already “obsolete.” And the opportunity lies in that perception gap.

So how do you prepare for the next bull run? The answer is: focus on the two companies that are leading this trend, each representing a different end of the market—Hyperliquid (HYPE) and Robinhood (HOOD).

Crypto end

Hyperliquid (HYPE) is a Layer 1 blockchain (like Ethereum and Solana), designed to host a perpetual derivatives market focused on crypto. Initially, investors used the Hyperliquid app to speculate on Bitcoin, Ethereum, and other pure crypto assets.

But the technology is so elegant—easy to use, instant settlement, 24/7 trading, and so on—that it quickly expanded into other markets. Today, nearly half of the trading volume on the Hyperliquid platform is concentrated in traditional assets like oil, silver, and the S&P 500 index. It’s expanding into spot commodities, prediction markets, and options. It is challenging exchanges across the board—from the Chicago Mercantile Exchange (CME), Nasdaq, and Intercontinental Exchange to Kalshi and Coinbase.

It’s been so successful that competitors are feeling anxious. The Chicago Mercantile Exchange (CME) is suing the U.S. Commodity Futures Trading Commission (CFTC), trying to stop the agency from promoting perpetual futures pioneered by Hyperliquid.

Despite the crypto winter, Hyperliquid’s token is still up 146% this year. The momentum is strong: the Hyperliquid platform’s cumulative revenue surpassed $1B in June, and it’s on track to achieve $800 million in revenue this year. The company uses 99% of its revenue to repurchase and burn its native token HYPE in the public market, reducing token supply. I think even if the price doubles, HYPE’s valuation still makes sense.

TradFi end

Robinhood is moving to solve this from the traditional finance side.

Robinhood is a traditional brokerage, competing with firms like Charles Schwab and serving both retail and professional investors. For a long time, Robinhood has been more crypto-friendly—for example, it was the first major brokerage to offer direct cryptocurrency trading.

It also fully agrees with my “merging” argument here. Its CEO, Vlad Tenev, said tokenization “will consume the entire financial system,” that crypto and finance “have long existed independently, but will eventually fully merge.” He predicts that the difference between the two will ultimately “disappear.”

On July 1, Robinhood threw itself into this idea, launching a Layer 2 blockchain called Robinhood Chain. This blockchain allows users in 120 countries (excluding the U.S.) to trade tokenized stocks 24/7. It also integrates standard DeFi protocols: users can swap assets on Uniswap, borrow and lend with assets as collateral on Morpho, or trade perpetual futures on Lighter. In just two weeks, deposits on Robinhood Chain exceeded $300 million, and daily trading volume reached 3.6 million trades.

Read that again. Since the beginning of this month, with just a light tap, Robinhood has rolled out a financial service across 120 countries/regions—enabling people to instantly buy and sell, do leveraged trades, and trade tokenized stocks anytime and anywhere. And people are using it at scale.

Skeptics will point out that most of the early trading was in Meme coins rather than stocks—which is true. But stock trading volume is meaningful, users are real, and I expect both to scale over time.

One thing I can be certain of: all of Robinhood’s major competitors are watching this closely and asking themselves, “Should we do this too? Do we need a Schwab Chain, a UBS Chain, or a Bank of America Chain?” Given Robinhood’s activity in its first few weeks, no one can afford to ignore it.

Two types of investments will win

I expect the coming bull market in size to boost most crypto sectors. I’m bullish on mainstream crypto—Bitcoin, Ethereum, Solana, and more—as well as crypto stocks.

But I think there are two categories of investment that are especially well-positioned.

1. Hyperliquid-style: Crypto finance applications with real revenue and strong token economics

The biggest difference between Hyperliquid and other crypto applications is its real revenue and strong token economics (99% of revenue is used to buy and burn HYPE tokens). That resonates with investors—who have watched crypto app users and trading volume surge, yet the tokens end up having no value.

I believe that over time, the next generation of crypto assets will emulate HYPE’s token economics model and bring exciting “next-gen” token opportunities. But for now, I’m more focused on existing projects that are already large in scale and actively tie token value to usage. For example, Uniswap and Aave both have massive operating scale and are rapidly improving their token economics models; Morpho is also moving in the same direction.

2. The Robinhood path: Existing companies building business on the crypto rails

Disruptive change reshapes market share. The transition toward stablecoins, tokenization, and blockchain-based payment systems is the biggest technology shift in financial markets in the past fifty years. A major upheaval is coming.

To find winners, I’m looking for companies that are truly trying crypto at large scale—not concept-validation projects that are cheap to build, can attract attention, but don’t teach you anything. The experience Robinhood has gained from covering real-time blockchain activity across 120 countries/regions is 10,000 times what any pilot project can provide.

The companies I’m watching include Coinbase, Figure, and BlackRock; I’d also consider Visa, Stripe, and even JPMorgan. Of course there are other companies, but these are the ones with real capability to participate.

Finding the convergence point

For a long time, there has been a view in the crypto space that its greatest success will come from its most hidden moment—when blockchain technology is deeply embedded into the architecture of the financial system, so much so that people don’t even realize it’s there.

I still strongly believe the next bull market—when traditional finance and crypto become inseparable—is exactly when that is happening. During this period, investors would be wise to prepare accordingly.