The Answer
Bitcoin may be the new foundation - not risk-free, but with different risks than traditional assets and superior long-term returns.
From: Bitcoin for Institutions
Current Mining Issuance
3.125 BTC per block (~10 min)
From: Bitcoin for Institutions
Institutional Holdings
Even dedicated institutions like Strategy will act like individuals with limited power in the Bitcoin economy.
From: Bitcoin for Institutions
What hasn't been done: Companies loading their pension trusts with bitcoin or bitcoin proxies, hoping to exploit their ability to enjoy bitcoin's superior returns, tax-free, over a significantly long time horizon. What should happen: Companies starting new qualified pension plans to accumulate bitcoin tax-free. Outside of a Roth IRA, there aren't really any other ways to accumulate bitcoin gains on a tax-free basis. Small Employers: It would make sense for owners of small companies (under 100 employees) to offer a defined benefit plan and maximize their contributions in bitcoin. Before the 1990s, hundreds of thousands of such companies offered pensions as a great tax shelter that also provid...
From: Pensions
Massive Scale
TDFs hold trillions in assets. Even 1% bitcoin allocation = massive demand.
From: Bitcoin for Institutions
📝 It is what it is — you're not gonna play the guitar without putting in the time, and time is very costly . It can't be faked, and it's a particularly gratifying win when it is realized for that reason.
From: Bitcoin Requires More Patience and Time than Institutions Have
The Four-Year Rhythm: The earliest that bitcoin collateral can be wound down is four years, aligned with bitcoin's four-year halving cycle. The loan carries a single-digit interest rate and has a maturity of 10 years. Credit markets operate around the concept of subordination - which loans get paid off first if a borrower has multiple loans. The most senior loan (paid off first) is the most creditworthy and demands the lowest yield. This idea of seniority is about to be flipped on its head by Battery Finance's loan product. If a borrower posts bitcoin as collateral, this loan would automatically become the most senior loan - not because of contractual priority, but because of behavioral prio...
From: Structured Credit
Key Insight from Bitcoin for Institutions:
2. Saylor's engineering mindset elevated bitcoin from "Magic Internet Money" to "Thermodynamically Sound Digital Real Estate."
Chapter: Strategy (Balance Sheet Strength)
Imagine: BlackRock's IBIT ETF has acquired 2 million bitcoin on behalf of its users. Bitcoin reaches gold's market capitalization of $20 trillion — that's about $1M per bitcoin. BlackRock's ETF would represent 10% of that value, or $2 trillion . That's $2 trillion of value on balance sheets of companies all over the world. Now imagine we discover that BlackRock cannot sell back that bitcoin because its custodian cannot perform the signatures required to move the keys. BlackRock loses $2 trillion, and all of their customers have to write down 100% of that value on their balance sheets. Poof. The world that understands BlackRock knows very little about their custodian, Coinbase. The problems w...
From: Bitcoin Custody Requires a Higher Understanding of Tradeoffs
Operating Profitability
Operating revenue less operating expenses - what the company expects to experience on a "run-rate" or under typical conditions.
From: Bitcoin for Institutions
People have varying levels of willingness to honor debts, often tied to consequences
From: Bitcoin for Institutions
Key Insight from Bitcoin for Institutions:
1. Bitcoin is the largest fixed-supply asset on Earth with 21 million units capped by immutable protocol, 95% already issued.
Chapter: Bitcoin Requires a Deflationary Mindset
""A bearer asset is a type of financial asset where ownership is determined by physical possession, rather than by registration or the holder's identity. In the past, traditional bearer assets included cash, because back in the gold standard era, cash represented a claim on the Central Bank gold reserve.""
— Brian Hirschfield
From: Bitcoin is a Bearer Asset
As an engineer, Saylor explained the properties of bitcoin from an engineering perspective in a way that is likely responsible for levelling up the understanding of bitcoin from "Magic Internet Money" to "Thermodynamically Sound Digital Real Estate." Saylor's worldview was simple. He had a $250 million pile of cash in 2020 and was looking at an epic monetary debasement of Western fiat currencies. The US was on its way to printing $7 trillion over an M2 monetary base of $15 trillion. $7 trillion printed over $15 trillion M2 base - nearly a 50% expansion of the money supply in a short period. Western cash holders were caught off guard, lulled into complacency by fifteen years of gaslighting ab...
From: Strategy (Balance Sheet Strength)
KYC/AML Regulations
"Know Your Customer" and "Anti-Money Laundering" regulations claim that nobody transacting has any right to privacy.
From: Bitcoin for Institutions
ℹ️ About this course: This interactive course follows the structure of Bitcoin for Institutions , covering why Bitcoin favors individuals, how key individuals drive institutional adoption, and specific strategies for institutional Bitcoin exposure.
From: Introduction
Pro
Coinbase has been doing custody for a long time. That's about the only item in the "pro" column.
From: Bitcoin for Institutions
Key Insight from Bitcoin for Institutions:
5. Target date funds are the biggest opportunity - trillions in assets with long horizons and passive investors.
Chapter: Mutual Funds / ETFs - Wielding the Blade
Key Insight from Bitcoin for Institutions:
3. Present Value masks debasement —traditional financial valuation hides the erosion of purchasing power in fiat currencies.
Chapter: Bitcoin Requires a Deflationary Mindset
No Contribution Limits
Executives can defer unlimited amounts, making NQDC ideal for significant bitcoin accumulation.
From: Bitcoin for Institutions