The recent entry of Morgan Stanley into the U.S. spot bitcoin ETF market has been seen by some as a catalyst for ending the current crypto bear market, given the substantial distribution power of the company's $8 trillion wealth management network.
However, Blockstream CEO Adam Back, an early contributor to the Bitcoin community, has cautioned that the process will take longer than expected. Back, who has been tipped as the potential creator of Bitcoin, Satoshi Nakamoto, emphasized that the adoption of bitcoin by institutional investors is a slow process. In an interview with Coindesk, he stated that the purchase of ETFs is just the beginning, and it may take up to a year or 18 months for investors to fully allocate their funds. Back's company, Blockstream, offers self-custody wallets and asset issuance services to both retail and institutional clients.
He also serves as the CEO and co-founder of BSTR, a bitcoin treasury company. The impact of government regulations on the crypto industry was also discussed, with Back noting that the current U.S.
presidency has introduced a new legislative framework for crypto and launched its own token shop. This has encouraged other jurisdictions to follow suit, such as the U.K.'s Financial Conduct Authority approving ETFs for retirement accounts. While the U.S. government's stance on crypto may change with new administrations, Back believes that the established bitcoin ETFs will continue to operate, defended by major providers like Black Rock and Morgan Stanley.
Another factor influencing bitcoin's price is its cyclical nature, driven by the quadrennial halving event. Although some commentators believe this cycle may be breaking, Back suggests that the possibility of a price slide remains due to market expectations.
However, the influx of institutional investors, such as those buying bitcoin directly or investing in bitcoin treasury companies, is likely to change this dynamic. Finally, Back addressed concerns about quantum computing's potential to break Bitcoin's cryptography, stating that while institutions may be paying attention to this risk, it is not a significant concern for the market at present.