‘Wall Street’ Doesn’t Need Bitcoin; Bitcoin Doesn’t Need ‘Wall Street’

 

‘Wall Street’ Doesn’t Need Bitcoin; 

Bitcoin Doesn’t Need 

‘Wall Street’

CoinDesk and others have been reporting about institutions cozying up to bitcoin as an investable asset for a while now. (Here’s CoinDesk reporting that insurance giant MassMutual some bought bitcoin in 2020; here’s me writing about BlackRock doing crypto things earlier this year).

I’m sick of it.

So this week’s column is about why Wall Street doesn’t need Bitcoin and why Bitcoin doesn’t need Wall Street.

Yes, I know, this might feel strange. Crypto Long & Short is an investor-focused newsletter about crypto, and so an issue contending that the biggest crypto asset doesn’t need … investors … might seem misplaced. My sole counterpoint is this: If your thesis is that Bitcoin doesn’t need big investors to succeed, then it’s at least worth considering an investment in it.

Also I might be exaggerating for dramatic effect …

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The Real Correlation Between Bitcoin and Wall Street

Here’s the thing about institutional investors – (which I’ll interchangeably refer to as “Wall Street” here even though it’s not technically correct) – getting into bitcoin: It was supposed to pump the price.

The moment Invesco put 5% of its $1.4 trillion assets under management into bitcoin, everyone else was going to do the same thing. The spike in demand, coupled with bitcoin’s famously finite supply, would send the price of bitcoin to untold heights.

Maybe it will happen one day, but it hasn’t yet.

Papering over a lot of nuance and entering the philosophical world where everything lives in a vacuum, there are two sides you can take on this highly specific point. Either: “Ha! Wall Street is going to be so screwed if Wall Street doesn’t buy bitcoin,” or: “Ha! Bitcoin is going to be so screwed if Wall Street doesn’t buy bitcoin.”

There’s also a third, (subjectively) correct side: “Wall Street doesn’t need Bitcoin; Bitcoin doesn’t need Wall Street.”