Bitwise CIO : Three Key Reasons to Invest in Ether

Matt Hougan, CIO of Bitwise, a leading crypto index fund and ETF provider, shares his insights on why ether (ETH) is a compelling asset for investment portfolios.

Diversification: Owning the Market

Hougan emphasizes diversification as a primary reason to invest in ether. Cryptocurrencies are still an emerging asset class, making it difficult to predict which specific trait will revolutionize the market. Therefore, investors should aim to “own the market.” Hougan suggests a 3:1 bitcoin (BTC) to ether allocation as a starting point for most investors.

Different Use Cases

Ethereum offers different use cases compared to Bitcoin. While Bitcoin aims to be the “best form of money,” Ethereum’s programmability and decentralized finance (DeFi) applications provide a unique market proposition. Hougan notes that adding ether to a predominantly bitcoin portfolio can give investors broader exposure to the diverse capabilities of public blockchains.

Historical Performance

Historically, including ether in an investment portfolio has enhanced returns over a full market cycle compared to a BTC-only strategy. Although BTC outperformed ETH last year, past performance indicates that ether can be a valuable addition. Hougan acknowledges that previous performance does not guarantee future results but highlights ether’s potential.


Hougan concludes that while Bitcoin may dominate as a new form of money, Ethereum leads in other blockchain applications. This week, Bitwise revealed a $2.5 million seed investment for its ether ETF product, underscoring the growing interest in ether as a crucial investment.


Disclaimer: Not Investment Advice

it’s crucial to understand that the information provided here is not to be construed as investment advice. The crypto market is dynamic and highly speculative, and decisions should be made based on thorough personal research and consideration of individual risk tolerance. Always consult with financial professionals and conduct your own due diligence before making any investment decisions. The intention of this exploration is to present insights and trends, not to provide specific investment recommendations.

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