As Bitcoin solidifies its role as a prominent digital asset, the pivotal question of whether more companies will start holding it on their balance sheets looms large. While a few trailblazers have ventured into this space, such as MicroStrategy under the leadership of Bitcoin enthusiast Michael Saylor, the broader corporate adoption remains uncertain.
In a recent discussion, Rob Nelson, host of Roundtable, explored this issue with Caitlin Long, Founder and CEO of Custodia Bank. Their conversation delved into the mindset of corporate treasurers, regulatory hurdles, and the future of Bitcoin as a mainstream financial asset.
Nelson initiated the conversation by inquiring whether increased corporate holdings of Bitcoin could spur wider adoption. Long, leveraging her previous experience as a managing director at Morgan Stanley, highlighted the cautious approach of corporate treasurers. “They are highly concerned with credit ratings and cash flow coverage ratios,” she explained. Long pointed out that while stablecoins might be treated as corporate cash, Bitcoin does not yet receive similar treatment from rating agencies and credit analysts.
Long revealed that some Fortune 10 companies have been discreetly incorporating Bitcoin for over a decade, underscoring a quiet but persistent adoption of cryptocurrency within major corporations. She recounted her own experience in 2014, when she introduced Bitcoin to a Fortune 5 company, marking an early instance of corporate acceptance.
The discussion then transitioned to the advisory role regarding Bitcoin. Despite the conservative stance of institutions like Morgan Stanley, Nelson noted that private investment advisors are increasingly engaging with cryptocurrency discussions. Long reflected on her trailblazing role at Morgan Stanley, where she was the first to present on Bitcoin in 2014, highlighting the initial resistance followed by gradual acceptance.
Nelson sought Long’s views on Bitcoin’s future value, comparing it to traditional financial instruments. Long emphasized Bitcoin’s unique characteristics, including its scarcity and technological attributes, predicting continued appreciation despite occasional downturns. She compared Bitcoin’s post-halving trends to the impact of decimalization in stock trading, where reduced margins led to higher trading volumes.
Looking ahead, Long discussed various pricing models suggesting Bitcoin could reach between $80,000 and $100,000 by year-end, with a potential peak around $150,000 for the current cycle. While she avoided precise predictions, Long expressed optimism, humorously stating she remains firmly in the “laser-eyed” camp until Bitcoin hits $100,000.
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