Bitwise: Crypto Market Declines for Third Straight Quarter, But Prediction Markets and Tokenized Assets Reach New Highs

ChainCatcher report: Bitwise’s Q3 2026 Crypto Market Review shows that the Bitwise 10 Large-Cap Crypto Index fell 15.4% in the second quarter, with eight of its ten constituent assets declining. Spot Bitcoin ETFs recorded their largest quarterly outflows on record, while on-chain activity, trading volume, and DeFi assets all decreased, and crypto market correlation with equities rose. During the same period, prediction market trading volume hit a new high of $43.2 billion, nearly an 18-fold year-over-year increase; tokenized real-world assets grew 50.3% year-to-date to $32.89 billion; the Bitwise Crypto Innovators 30 Index rose 30.6%; stablecoin settlement volume reached 2.3 times that of Visa, with stablecoin holdings of U.S. Treasuries exceeding those of most countries; Hyperliquid, PancakeSwap, and Aave each generated approximately $900 million in revenue over the past year. Bitwise noted that this marks the third consecutive quarter of negative returns—the longest such streak since 2022. However, compared to the bottom of the 2022 bear market, Ethereum transaction activity has grown approximately 13-fold, DeFi total value locked has increased by over 60%, and stablecoin assets under management have roughly doubled.