In a recent interview on Bloomberg, Damien Vanderwilt, Co-President of Galaxy Digital talked about what he thought it would take for the world’s institutions to finally buy Bitcoin.
A recent poll by Gartner reveals that only 5% of finance executives are at the thinking about it stage, so it was asked of Vanderwilt what his views were on this.
Vanderwilt said that the main considerations were safety and security, and then also tax considerations. These weren’t seen as insurmountable obstacles but that these issues would take time to solve.
Michael Sayler of MicroStrategy, and Jack Dorsey of Square were held up as great examples of how top execs can educate their shareholders. The up to now positive experience of these shareholders can help other companies to take the plunge and buy a small allocation of Bitcoin for their treasuries.
Investment banks were discussed and in particular, how they need “a safe product” for their customers. How to custody Bitcoin and the associated risks were what banks and their advisors, such as Galaxy Digital, are currently looking into.
Wholesale funding and the interest spreads on products traded would be of great interest to banks. Vanderwilt suggested that lending of Bitcoin would be next on the banks' agenda after they’ve looked at wealth.
On considering Bill Gates’ view on Musk’s purchase of Bitcoin, and also Gates’ feelings on Bitcoin as a whole, Vanderwilt said that too much can’t be taken from the pronouncements of just one person, and that individual circumstances need to be evaluated when looking at how much Bitcoin should be allocated.
Vanderwilt pointed out that the US dollar and Gold were seen as extremely safe assets until recently, but when you consider “the backdrop of looming inflation”, a very compelling case can be argued for:
“a hard asset like Bitcoin that is very secure and very easy to transact with relative to any of those other comparable assets. Then making a small allocation into this sector seems very reasonable to me.”
To conclude, when asked about Galaxy Digital’s outstanding 4th quarter and whether the company could continue to “keep it up”, Vanderwilt replied that his company was doing everything it could under the constraints of time.
He reiterated the importance of safety for Galaxy Digital’s clients, and stated that a lot of time was being spent walking clients through the due diligence process. Hiring was a top priority and Vanderwilt said that the company was targeting 50 new employees in the first quarter in order to keep up with client demand.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.