Alex Thorn of Galaxy Digital’s Head of Research, Alex Thorn provided invaluable insights at the MicroStrategy World Conference: Bitcoin for Corporations. He discussed the changing landscape for Bitcoin adoption on Wall Street.
Thorn discussed in an interview with Bitcoin Magazine how Wall Street is beginning to embrace Bitcoin. He also explored the dual role of Bitcoin as a technology tool as well as a treasury. Institutional investors have begun to view bitcoin more as a safe-haven asset.
The Bitcoin: A Treasury Tool or Technological Asset?
Thorn said that corporations would probably use both Bitcoin and its technology.
“That’s the same question we have about regular users,” He added. Thorn, citing insights shared by David Marcus, LightSpark’s CEO, also speaking at the event highlighted that Bitcoin usage varies depending on region and needs.
Bitcoin is a good store of value in countries where currencies are depreciating. In places such as Bitcoin Beach, El Salvador, the enthusiasm is strong for it being used as a means of exchange.
Thorn highlighted the possibility for companies to use Bitcoin technology for international money transfers.
Thorn said that businesses could take advantage of solutions such as LightSpark OpenNode Voltage which allow them to use Bitcoin Lightning Network’s payment rail without holding any assets.
“It’s honestly hard to know,” Thorn stated that the two uses can be used depending on their context.
Normalizing Bitcoin
Conversations then turned to Wall Street’s acceptance of Bitcoin, and its effect on spot Bitcoin exchange-traded funds (ETFs).
Thorn said that Bitcoin has become more mainstream, in part due to investment instruments like Bitcoin spot ETFs.
“There’s a multitude of ways to access bitcoin right now,” He explained.
“You’ve not only got these ETFs, which are super easy to access for both retail and institutions, but you also have had, for several years now, institutional companies — Galaxy is one of them — that make it easy for institutions to buy spot bitcoin, let alone the Rivers, Swans You can also find out more about the following: CoinbasesHe added.
Thorn also highlighted the macroeconomic drivers of Bitcoin’s appeal. Thorn noted that financial leaders such as Jamie Dimon, Jay Powell and others are increasingly acknowledging the unsustainable nature of US debt. This has been an opinion held by gold supporters for many years.
It is a very attractive investment.
“We see this when we talk to macro hedge funds,” Thorn highlighted that some people have traded bitcoins for many years.
Bitcoin ETFs, Corporate Treasuries and Corporate Treasuries
Thorn, in addressing the impact that spot Bitcoin ETFs could have on corporate treasuries after 2006, when the first ETF was approved, drew comparisons to the gold market.
He acknowledged Bitcoin’s four-year historical boom and bust cycle, but suggested current interest was driven by factors more sophisticated than the past.
“It’s not just a wave of people first hearing about Bitcoin,” Thorn said, inferring a more profound, strategic interest from investors.
Thorn noted a rising interest amongst long-term investors, such as endowments or pension funds. They are now reengaging in Bitcoin following initial hesitations.
According to Thorn, these investors with longer-term time frames see bitcoin as an insurance against a volatile environment.
“Bitcoin is in this chasm between risk and hedging,” Thorn said that, while Bitcoin is still not regarded as an alternative to traditional hedges, the perception of it is changing.
Future adoption and generational shifts
The discussion also touched upon the impact of generational differences on Bitcoin adoption.
Thorn acknowledges that older generations often hesitate to adopt new technology. He noted, however, that spot Bitcoin ETFs would ease the transition because they simplify access.
“The younger generations more [quickly adopt] innovation,” Thorn added that adoption rates could increase as younger generations become more comfortable with Bitcoin.
Thorn also discussed the importance of financial advisers during this time.
Advisors are often trusted to help people manage their investment portfolios. As spot Bitcoin ETFs appear on platforms for wealth management, they can now introduce bitcoin into their client’s portfolios. The older generation may be more willing to invest in bitcoin if they have access to spot Bitcoin ETFs.
Alex Thorn, in his closing remarks at the conference, emphasized the many facets of Bitcoin’s future.
Bitcoin is becoming more important, whether as an asset for treasuries, a technology tool or a hedge against macroeconomic risks.
Bitcoin’s popularity among corporate investors and individuals is set to increase as generational changes occur.
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Source: bitcoinmagazine.com
