Adam Back: Institutional Funds are Positioning for Bitcoin, but the Entry Pace is Slower than Market Expectations

On April 29, some observers viewed Morgan Stanley’s recent foray into the U.S. spot Bitcoin ETF as a catalyst for ending the current crypto bear market, citing the brokerage’s vast distribution capabilities through its $8 trillion wealth advisory network. However, Adam Back, CEO of Blockstream and an early contributor to the Bitcoin community, stated that “it won’t happen that quickly.” Back was recently speculated by The New York Times to be the anonymous Bitcoin founder Satoshi Nakamoto, a claim he denied. Back indicated that, from a positive market signal perspective, the Bitcoin ETF might be the most significant development recently, even more so than a pro-crypto U.S. government, but the process is slower than most realize. He noted, “I think one thing people might be miscalculating is that institutional adoption is very slow. So the ETF has been bought, but when BlackRock suggests allocating 2% to 4% in its general stock portfolio, fund managers haven’t done that yet. They will, but slower than people expect.” He mentioned that investors will not flood in overnight, and the accumulation process could take a year or even 18 months. Regarding prices, Back stated that the cyclical nature of Bitcoin’s four-year halving cycle must be considered. He pointed out that even if some commentators believe the four-year cycle is breaking down, “people expect it to happen, so they sell to make it actually happen,” and a decline could still occur. This logic will only change once people see the market strengthen, which is currently manifesting in the form of institutional capital inflows. Back also commented on recent discussions about the accelerated development of quantum computing hardware potentially threatening Bitcoin’s cryptography, noting that institutions are more systematic in risk management, focusing on tail risks, while retail investors view it as a distant future risk.