According to foreign media, the Chief Executive Officer of Bitwise, Hunter Horsley, in a recent communication from platform X, indicated that the encryption industry was going through a phase of transition and that the market was moving from a “story-telling” to a “results-reading” test for the project. He compared this change to the re-evaluation process after the collapse of the Internet bubble more than 20 years ago.

Moving from narrative to outcome-driven

Horsley argues that the phase of access to valuation by road map, vision or market heat alone is shrinking. Fewer projects will remain in the future, but for long-term funding to be supported, clearer adoption, income performance or actual use will be required.

The core of this comment is not to judge that the industry will be weak, but rather that the market is raising the threshold. As institutional funding deepens, the availability of verifiable business progress is becoming more important than mere conceptual packaging.

Use of filtering logic after Internet bubbles

Horsley compares the current encryption market with the 1990s Internet boom. At that time, a large number of companies obtained high valuations based solely on “Internet-related” expectations, but after market adjustments around 2000, companies lacking real business support were quickly phased out.

In his view, the number of companies that had actually emerged from the restructuring was often not the largest, but rather the few that had proved to be viable in their own model. Their subsequent expansion cycles are longer and ultimately larger than the earlier market-wide expectations.

Agencies value adoption, income and implementation more

According to Horsley, the value of the next stage of the encryption industry may be concentrated on a smaller number of projects. These projects need to prove that they have established real needs, rather than relying on future narratives to maintain attention.

For the market, this means that the funding screening may continue to strengthen. In particular, where institutional funding is more focused on adoption, income and implementation capacity, projects that lack a physical landing or a user base will become more difficult to sustain.

  • Possible reduction in the number of projects to be won in the long term
  • The number of winning projects or larger, longer-term
  • Market focus is shifting to verifiable performance.

It was also mentioned that Bitwise, as an encryption authority, received attention from its executives because of its long-term observation of financial flows, product demand and staffing behaviour. Horsley's judgement also reflects a growing corporate consensus on “quality priorities”.