The recent involvement of Morgan Stanley in the US spot bitcoin ETF market has been viewed by some as a pivotal moment that could potentially bring an end to the current bear market in crypto, given the vast distribution capabilities of the company's $8 trillion wealth management network. However, according to Blockstream CEO Adam Back, an early contributor to the Bitcoin community, this process will take longer than anticipated. Back emphasized that while bitcoin ETFs are a crucial development for positive market signals, even surpassing the impact of a pro-crypto US administration, institutional adoption is slower than most people realize. He noted that investors do not immediately pile into the market, and a significant build-up could take up to a year or 18 months.
Back also pointed out that the regulatory environment, particularly the introduction of a new legislative framework for crypto under the current presidency, has indirectly encouraged other jurisdictions to follow suit. The establishment of bitcoin ETFs, now supported by major financial institutions like BlackRock and Morgan Stanley, is expected to provide a lasting impact that transcends political administrations.
Additionally, Back discussed the cyclical nature of bitcoin's price, driven by the quadrennial halving event, and the potential for institutional flows to eventually overwhelm sellers. He also addressed concerns about quantum computing's potential to break Bitcoin's cryptography, suggesting that while it may be a consideration for institutions, it is not an immediate threat.