Former Tour de France winner Wiggins was part of the England side beaten by Australia in the 4000 metres team pursuit final at the Commonwealth Games on Thursday.
Afterwards, he confirmed he was "done with the road", adding that he would now focus on the Olympics in the Brazilian capital two years from now.
Six-time Olympic champion Hoy believes Wiggins can enjoy success in Rio but has warned of the difficult transition he faces.
"Brad is probably the best cyclist Britain has ever produced, and certainly the greatest all-round cyclist," the 38-year-old told Sky Sports News.
"But even for him to make that transition from being a three-week grand tour rider to coming back on the track to race for less than four minutes, it’s a huge change.
"It will take time but if anyone can do it Brad can. He needs to gain muscle mass but the guys will gain strength from having Brad in the team.
"It will be great to see him in Rio. It won’t be easy but if anyone can do it he can and he's box office too."