At the recent MicroStrategy World: bitcoin for Corporations conference, Alex Thorn, Head of Research at Galaxy Digital, provided valuable insights into the changing landscape of bitcoin adoption by Wall Street and corporations.
In an interview with bitcoin Magazine, Thorn explored how Wall Street has begun to embrace bitcoin, the dual nature of bitcoin's role as a treasury asset and technological tool, and how both institutional investors are beginning to view bitcoin more as a safe haven asset. .
bitcoin: treasury asset or technological tool?
When asked if corporations are more likely to view bitcoin (btc) as a treasury asset or use its underlying technology, Thorn acknowledged there would likely be some of both.
“That's the same question we have about regular users,” he said. Drawing on insights from LightSpark's David Marcus, who also spoke at the event, Thorn highlighted how bitcoin usage varies by region and need.
In countries with depreciating currencies, bitcoin serves as a store of value. On the contrary, in places like bitcoin Beach in El Salvador, there is great enthusiasm for using it as a medium of exchange.
Thorn emphasized the potential for corporations to leverage bitcoin technology for global money transfers.
According to Thorn, companies could benefit from solutions such as LightSpark, OpenNode and Voltage, which make it easier to use bitcoin's Lightning Network as a payment method without necessarily owning the asset.
“Honestly, it's hard to know,” Thorn concluded, noting that both uses are viable depending on the context.
Normalizing bitcoin
The conversation then turned to Wall Street's adoption of bitcoin and the effect of spot bitcoin ETFs.
Thorn confirmed that bitcoin is becoming more normalized, in part due to the proliferation of accessible investment vehicles such as bitcoin spot ETFs.
“There are a multitude of ways to access bitcoin right now,” he explained.
“Not only do we have these ETFs, which are very easy to access for both retail and institutions, but we also have, for several years, institutional companies (Galaxy is one of them) that make it easier for institutions to purchase . detect bitcoin, let alone the rivers, swans and Coin bases”he added.
Thorn also pointed out the macroeconomic factors driving bitcoin's appeal. He noted a growing recognition among financial leaders, such as Jamie Dimon and Jay Powell, of the unsustainability of the US national debt, which has traditionally been a view held by gold advocates.
This realization has made it an increasingly attractive investment.
“We see this when we talk to macro hedge funds,” Thorn said before highlighting that many have been trading bitcoin for years.
bitcoin ETFs and Corporate Treasuries
Addressing the potential impact of spot bitcoin ETFs on corporate treasuries, Thorn drew parallels with the gold market after 2006, following the approval of the first gold ETF.
While he acknowledged bitcoin's historical four-year boom and bust cycles, he suggested that current interest is driven by more sophisticated factors than in the past.
“It's not just a wave of people hearing about bitcoin for the first time,” Thorn said, implying a deeper, more strategic interest among investors.
Thorn noted growing curiosity among long-term investors, such as endowments and pensions, who are recommitting to bitcoin after their initial hesitation.
According to Thorn, these investors, with longer time horizons, see bitcoin as a hedge in a volatile risk environment.
“bitcoin sits in this chasm between risk and hedge,” Thorn explained, noting that while bitcoin is not yet marketed as a conventional hedge, its perception is evolving.
Generational changes and future adoption
Finally, the discussion addressed the generational dynamics that influence bitcoin adoption.
Thorn acknowledged that older generations are often hesitant to adopt new technologies. However, he noted that the introduction of spot bitcoin ETFs could ease this transition by simplifying access.
“Younger generations are more (rapid) adopters of innovation,” Thorn noted before adding that as wealth is transferred to younger generations more familiar with bitcoin, adoption rates may increase.
Thorn also highlighted the role of financial advisors in this transition.
Many people rely on advisors to manage their investments, and as spot bitcoin ETFs become available on wealth management platforms, advisors can introduce bitcoin into their clients' portfolios. This could generate significant capital inflows from older demographics who might otherwise be reluctant to interact directly with the asset.
In conclusion, Alex Thorn's insights at the conference underscore the multifaceted future of bitcoin.
Whether as a treasury asset, technological tool or macroeconomic hedge, bitcoin's role is expanding.
As generational shifts occur and bitcoin ETFs become more prevalent, bitcoin adoption among corporations and individual investors is poised to grow.
