Author: Matt Hougan, Chief Investment Officer, Bitwise; Translated by: Jinse Finance
The best cryptocurrency investments offer two profit paths.
My favorite cryptocurrency investments offer me double profit opportunities. Take Bitcoin as an example.
When I buy Bitcoin, I'm actually making two bets:
1. The global "store of value" market will continue to expand.
2. Bitcoin's share in this market will continue to increase.
If either one comes true, I can get a good return.
Currently, the global market size for stores of value is approximately $27.5 trillion: gold accounts for $25 trillion and Bitcoin accounts for $2.5 trillion. (You might think that assets such as silver, art, Ethereum, and real estate also belong to this market, but for the sake of simplicity, they will not be included in this discussion.) If the market size for stores of value grows (for example, doubling from $27.5 trillion to $55 trillion), its value will double as long as Bitcoin maintains its current 9% market share. Similarly, even if the market size remains unchanged, its price will double if Bitcoin's market share doubles to 18%. Many investors make the mistake of focusing excessively on Bitcoin's potential market share gains while ignoring the market's inherent growth potential. The global store of value market has grown tenfold over the past 20 years, from less than $3 trillion in 2005 to $27.5 trillion today. If this trend were to repeat itself, Bitcoin's value could potentially increase tenfold again—a goal I believe is entirely achievable. If Bitcoin can simultaneously increase its market share, the gains will be amplified. If the market grows tenfold and Bitcoin eventually reaches parity with gold (i.e., capturing 50% of the market share, which I believe is a reasonable scenario for the next 20 years), each Bitcoin would be worth $6.5 million. I'm not asserting this will definitely happen, but that's the allure of a "double bet." What about Solana? When I invested in Solana, I was making a double bet: 1. The stablecoin and asset tokenization infrastructure market will continue to grow; 2. Solana's market share in this market will continue to increase. In my opinion, both bets have great potential. Currently, several excellent Layer 1 blockchains have entered the stablecoin and asset tokenization infrastructure market. Ethereum is the industry leader, holding the largest share in stablecoin issuance, trading volume, and fund tokenization; Tron, Solana, and BNB are the main competitors in the stablecoin market. The total market capitalization of these assets is $768 billion. While Solana is a significant player in this market, its current market capitalization of $107 billion is relatively small, representing only 14% of the overall market—which is precisely why it's a good fit for a double bet. I am very confident in the growth of the stablecoin and asset tokenization infrastructure market. I believe people have severely underestimated the market-reshaping power of these technologies. In time, I expect almost all payments to be completed through stablecoins and almost all assets to be tokenized. The blockchains driving this growth will possess immense value. It's easy to imagine that this market could grow tenfold or more. I am equally optimistic about Bitcoin, Ethereum, and other blockchains, but I also highly recognize Solana's potential to capture a larger market share. It boasts high-speed, easy-to-use technology, backed by a high-quality community that embraces a "rapid iteration" philosophy. As a relatively new asset, Solana is still catching up with its peers in obtaining institutional authorizations, but it has already made significant progress: just this week, Western Union chose Solana as its underlying blockchain when it announced the issuance of its stablecoin. If my assessment is correct, the dual benefits of market expansion and increased market share will bring explosive growth to Solana—just like the development path of Bitcoin. Investing in cryptocurrencies requires humility and reverence. Even the most seasoned experts cannot accurately predict future trends. However, if one can obtain two highly certain bets with a single investment, it will undoubtedly greatly increase the probability of profit, which is precisely the allure of cryptocurrency investment.