Supply Shock Bitcoin, Not Blockchain: Wall Street’s Big Flip
Jun 3, 2025
Adam Back, CEO of Blockstream and a cryptography pioneer, alongside Sean Bill, the firm's Chief Investment Officer, dive into the shifting landscape of institutional Bitcoin investment. They discuss how pension funds and endowments are engaging with Bitcoin, exploring innovative investment vehicles and risk management strategies. The duo also highlights the rise of Bitcoin treasury companies like MicroStrategy and warns about the potential pitfalls of leveraging debt in Bitcoin accumulation. Their insights reveal how Wall Street is transforming its relationship with Bitcoin amidst increasing institutional interest.
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Innovative Institutional Mining Product
- Blockstream began institutional mining investments by bundling individual miner interests into a fungible financial product.
- This strategy socialized mining performance and mitigated individual miner failure risks.
Easing Institutions into Bitcoin
- Blockstream focuses on institutional clients like pensions and sovereign wealth funds to ease their entry into Bitcoin.
- Their income fund uses Bitcoin-collateralized loans as a low-risk way to gain market exposure before direct Bitcoin ownership.
Wall Street's Shift to Bitcoin
- Around 2015-2017, banks focused on blockchain technology fearing disruption, not on Bitcoin itself.
- This has flipped: now institutions focus on delivering Bitcoin products to clients, signaling growing market adoption.