Will BlackRock Trigger Hyperbitcoinisation? With Alex Thorn

 
 

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“This is the beginning of what hyperbitcoinisation looks like, people want bitcoin everywhere? That means it’s going to be everywhere…if bitcoin’s going to be global money it’s needs to be everywhere, it needs to be in every single system that uses money.”
— Alex Thorn

SHOW DESCRIPTION

Alex Thorn is Head of Firmwide Research at Galaxy. In this interview, we discuss Bitcoin Park and others' efforts to promote Bitcoin, the impact of BlackRock's involvement in Bitcoin, and the legal battle between Coinbase and the SEC. We also talk about the need for education and inclusivity for Bitcoin, the importance of maintaining decentralization, and the impact of Bitcoin on the future.

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BlackRock is the world’s largest asset manager, with AUM in excess of $9 trillion. So, the news that they were throwing their hat into the spot Bitcoin ETF ring has unsurprisingly caused excitement and concern within the Bitcoin community. If BlackRock is successful it will materially widen access to Bitcoin, and significantly increase the buying pressure.

In terms of signal, this is perhaps the most important event in the validation of Bitcoin as an asset. Larry Fink, BlackRock’s CEO, has changed tack and is now endorsing Bitcoin as digital gold. Such comments penetrate more than those of other commentators and provide unparalleled credence to Bitcoin amongst the professional investing class.

The pressure on the SEC will only now increase as they review the latest batch of Bitcoin spot ETF applications. This is at a time when they are involved in a number of critical legal disputes, including their battle against Coinbase. The SEC’s approach - failing to provide formal rulemaking for the crypto markets whilst operating a divide-and-rule approach to individual companies - is "extremely stifling" to say the least.

That said, whilst increased engagement from traditional asset managers is welcomed, it also comes with material risks. There are rightfully severe concerns about their involvement's impact on efforts to promote self-custody and strengthen decentralisation. It is vital that those managing or advising new investments are educated on Bitcoin’s unique characteristics in ways that appeal, and that they are welcomed into the Bitcoin community.

Bitcoin needs to be understood and embraced by mainstream culture in order to achieve widespread adoption. The community, therefore, needs to make Bitcoin accessible to a diverse group of people, regardless of their backgrounds, experiences, geographies, and ideologies. At the same time, Bitcoin’s core values need to be protected. Strong, principled voices like Marty Bent, Stephan Livera, and Matt Odell, need to continue educating and guiding the community.

TIMESTAMPS

00:01:32: Introductions
00:02:28: Mashinsky and Celsius
00:04:48: Rap and other music
00:16:16: Real Bedford
00:26:06: About Alex, and BlackRock
00:30:31: ETF timing, structure and liquidity
00:40:56: Rejected ETFs, and SEC regulation
00:45:54: Hyperbitcoinisation, the risks and fears
00:56:19: Bitcoin education for institutions
01:05:11: Scaling Bitcoin and Bitcoin culture
01:26:19: Final comments

 

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SHOW NOTES

PodcastPeter McCormack