Crypto is turning into a “contrarian bet” as institutional investors are being drawn to artificial intelligence stocks, says Bitwise chief investment officer Matt Hougan.

“The crypto market is brutal right now,” Hougan wrote in a market note on Tuesday. “One major reason is that crypto is no longer the belle of the ball. AI stocks, robotics companies, SpaceX … who needs crypto when the Nasdaq-100 is up 43% year-over-year?”

“With AI sucking all the oxygen out of the room, crypto is being forced to go through a painful metamorphosis: from momentum trade to contrarian bet.”

Stocks linked to companies involved in AI have skyrocketed as the technology has captured investor attention after OpenAI launched ChatGPT to the…