Bitcoin Is Waiting On One Thing Before Institutions Go All-In | Ron Biscardi

Bitcoin Waits on Custody Before Institutions Commit

This episode is about what the largest pools of institutional money, pensions, endowments, sovereign funds and family offices, are actually doing right now. Bitcoin has won the argument over legitimacy, but the plumbing is missing, so the money stays outside the market until custody and rules arrive. Attention has shifted to AI, where the questions are political and physical, from a Texas data center moratorium to SpaceX's bet on computing in orbit. Venture's reopened IPO window is what will keep that pipeline financed.

Takeaways

• Crypto institutions need custody guardrails first. Biscardi says the view of bitcoin flipped from snake oil to legitimate asset class, but the blocker is regulation. Pensions, endowments and sovereign funds cannot commit until they can tell their boards that assets are custodied at a major bank like Goldman Sachs or JPMorgan.
• Crypto cheques still come from family offices. iConnections hosted 16 or 17 digital asset funds taking 800 meetings in 2022 and 50 to 100 crypto funds today, but Biscardi hears of no billion-dollar cheques. Most scaled crypto capital is family office and individual money.
• Texas moratorium threatens planned data centers. About 13% of planned US data centers sit in Texas, which combines cheap land with the country's energy base. Biscardi expects permitted projects to proceed and unpermitted operators to build in other states rather than wait a year. A slowdown would hand China an advantage.
• Orbital data centers could compete within three years. SpaceX has already demonstrated laser links in Starlink and its engineers are working flat out. One Starship lifts about three Falcons' worth of satellites, latency is not the constraint, and Pompliano sees space traffic as the coming problem.
• Venture's funding drought is over. Three or four years of illiquidity hit venture hardest, and the IPO market led by SpaceX reset sentiment. Biscardi expects Anthropic's listing to keep momentum going and says venture will stay a strong asset class for years.
• AI revenue growth defies the valuation cuts. Anthropic was expected at $2tn and now sits near $1.5tn, while OpenAI looks set to raise $20bn instead of $30bn. Anthropic went from zero to $16bn of annual revenue in four or five years, growth Biscardi calls unprecedented.
• Private credit fears were overstated. Leverage runs two or three to one and distressed portfolios sold at 60 to 90 cents on the dollar. Private credit funds took 3,000 of roughly 20,000 meetings at Biscardi's Miami event and lend to middle-market businesses banks do not serve.