Galaxy Digital: Is Bitcoin a financial asset or a technological tool?

Original author: Frank Corva, Bitcoin Magazine

Original compilation: Deng Tong, Golden Finance

At the recent "MicroStrategy World: Enterprise Bitcoin" conference, Galaxy Digital head of research Alex Thorn provided valuable insights into the evolving landscape of Wall Street and corporate adoption of Bitcoin. insights.

In an interview with Bitcoin Magazine, Thorn discussed how Wall Street began to embrace Bitcoin, Bitcoin’s dual nature as a financial asset and technological tool, and how institutional investors began to view Bitcoin as a safe haven assets.

Bitcoin: Financial asset or technical tool?

When asked whether businesses were more likely to view Bitcoin (BTC) as a financial asset or to leverage more of its underlying technology, Thorn admitted that it was probably a bit of both.

“This is the same issue we have with regular users,” he noted. Drawing on insights from LightSpark’s David Marcus, who also spoke at the event, Thorn highlighted how Bitcoin usage varies by region and demand.

In countries with devalued currencies, Bitcoin can be used as a store of value. On the contrary, in places like El Salvador’s Bitcoin Beach, there is a strong enthusiasm for using it as a medium of exchange.

Thorn highlighted the potential for businesses to leverage Bitcoin technology for global remittances.

Thorn said companies could benefit from solutions such as LightSpark, OpenNode and Voltage, which facilitate the use of Bitcoin’s Lightning Network as a payment channel without the need to hold assets.

"Honestly, it's hard to know," Thorn concluded, noting that both uses are possible, depending on the circumstances.

Bitcoin Universalization

The conversation then turned to Wall Street’s adoption of Bitcoin and the impact of spot Bitcoin ETFs.

Thorn confirms that Bitcoin is becoming more ubiquitous, in part due to the proliferation of available investment vehicles like spot Bitcoin ETFs.

“There are many ways to get Bitcoin now,” he explained.

“Not only do you have these ETFs that are very accessible to retail investors and institutions, but you also have institutional companies over the years — Galaxy being one of them — that have made it easy for institutions to buy spot Bitcoin. , not to mention Rivers, Swans and Coinbase," he added.

Thorn also pointed to macroeconomic factors driving Bitcoin’s appeal. He noted that financial leaders such as Jamie Dimon and Jay Powell are increasingly recognizing the unsustainability of U.S. Treasuries, which has historically been the view of gold advocates.

This recognition makes it an increasingly attractive investment.

Thorn said: “We see this when we talk to macro hedge funds.” He then emphasized that many hedge funds have been trading Bitcoin for years.

Bitcoin ETFs and Corporate Bonds

When it comes to the potential impact of spot Bitcoin ETFs on corporate finances, Thorn compared it to gold after the first gold ETF was approved in 2006. The market was compared.

While he acknowledged the four-year boom and bust cycle in Bitcoin’s history, he said current interest is driven by more complex factors than in the past.

Thorn said: “This is not just a wave of people hearing about Bitcoin for the first time.” It means a deeper and more strategic interest from investors.

Thorn has observed growing curiosity among long-term investors, such as endowments and pension funds, who are re-engaging in Bitcoin after initial hesitation.

These investors have a longer investment horizon and view Bitcoin as a hedge in a volatile risk environment, Thorn said.

Thorn explained: “Bitcoin is in the chasm between risk and hedging.” He said that although Bitcoin is not yet traded as a mainstream hedging tool, the concept of it is constantly evolving.

Investor Generational Change and Future Adoption

Finally, the discussion touches on the generational dynamics affecting Bitcoin adoption.

Thorn acknowledges that older generations are often hesitant to embrace new technology. However, he noted that the launch of a spot Bitcoin ETF could ease the transition by simplifying access.

“Younger generations [adopt] innovation more quickly,” Thorn said, adding that adoption rates are likely to increase as wealth is transferred to younger generations who are more familiar with Bitcoin.

Thorn also emphasized the role of financial advisors in this shift.

Many people rely on advisors to manage their investments, and with spot Bitcoin ETFs available on wealth management platforms, advisors can introduce Bitcoin into their clients’ portfolios. This could drive significant inflows from an older population who might otherwise be reluctant to participate directly in the asset.

In conclusion, Alex Thorn’s insights at the conference highlighted Bitcoin’s multi-faceted future.

Whether as a treasury asset, a technology tool or a macroeconomic hedging tool, Bitcoin’s role is expanding.

As the generational shift occurs and spot Bitcoin ETFs become more commonplace, Bitcoin adoption among businesses and individual investors is set to grow.

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