BlackRock's Perspective on Bitcoin Investment
Most of BlackRock's clients are not considering Bitcoin's potential use for daily payments when deciding whether to invest in the asset, according to the world's largest asset manager's head of digital assets.
"I think for us, and most of our clients today, they're not really underwriting to that global payment network case," Robbie Mitchnick stated during a podcast interview published Friday. He characterized Bitcoin's payment potential as "sort of maybe out-of-the-money-option-value upside."
Mitchnick clarified this does not mean Bitcoin won't eventually achieve widespread use in payments, but called that scenario "a little bit more speculative." He stressed investors are far more focused on the digital gold or store-of-value thesis for Bitcoin.
"There's a lot that needs to happen in terms of BTC scaling, Lightning, and otherwise to make that possible," Mitchnick stated. Galaxy Research suggested in August 2024 that most BTC layer-2 scaling networks, particularly rollups, may not be sustainable long-term despite popularity as a promising method to keep BTC payments cheap, fast, and decentralized.
The Rise of Stablecoins in Payments
Mitchnick stated that stablecoins have been "hugely successful" in the payments sector. "They do have massive product market fit as a payment instrument as a way of moving value around efficiently," he said.
"Stablecoins have the potential to greatly expand where they are used today, going beyond just the sort of crypto trading ecosystem and DeFi to actually doing retail remittance payments, corporate, multinational, cross-border transactions, and capital market settlement activity," Mitchnick explained. He suggested BTC has a better chance of competing in retail remittance payments than other areas, but isn't ruling anything out.
Impact on Bitcoin Price Predictions
ARK Invest CEO Cathie Wood recently stated that stablecoins "scaling faster" than expected is the reason for her lowering her 2030 BTC price prediction. "Stablecoins are usurping part of the role that we thought that Bitcoin would play," she stated.
Wood explained she previously projected Bitcoin could reach $1.5 million by 2030, but with stablecoins now serving many use cases that she thought Bitcoin would dominate, she may trim that forecast by about $300,000. "I think emerging markets are huge in this regard and we're starting to see institutions in the United States focused on new payment rails," Wood said.
Tether co-founder Reeve Collins told Cointelegraph in September that he expects "all currency" to become stablecoins by 2030 as part of a broader shift that will see all forms of finance go on-chain.
Conclusion: Store of Value vs. Payment Solution
Mitchnick's comments underscore how institutional investors view Bitcoin primarily as a store of value rather than a payments solution, with stablecoins capturing the transaction and settlement use cases many once envisioned for BTC across retail, corporate, and capital markets applications.