Capital Decanted – Episode #4 S2: Decanter’s (Half) Dozen: A Crypto Golden Age?

Release Date: September 16, 2025
Hosts: John Bowman & Aaron Filbeck
Guests: Greg Tussar (Coinbase), Robby Michnick (BlackRock)
Summary Prepared By: [Podcast Summarizer, AI]

Episode Overview

This episode, selected as one of the “Decanter’s Half Dozen,” dives deep into the history, current state, and possible future of cryptocurrency in institutional portfolios. The central question: Has crypto entered a golden age of mature institutional adoption, or are we still seeing mostly anecdotal sizzle over substance?
The hosts guide listeners through the history of digital assets, the shifting regulatory/political landscape, and evolving institutional sentiment—culminating in an insightful segment with two industry heavyweights from Coinbase and BlackRock.

Main Discussion Points & Structure

1. Setting the Stage: Why This Episode?

[00:00–15:07]

• Download statistics alone don't fully capture an episode's impact, so the hosts used both data and industry feedback to create the “Half Dozen.”
• Crypto, while previously discussed, hadn’t been the focus—making this a first for a comprehensive deep dive.
• The 2024 U.S. election, with Trump’s promise to make the U.S. the “crypto capital of the world,” fundamentally altered the landscape.
• The space’s $3T market cap, Spot Bitcoin ETF approvals, and major firm activity serve as context for rising institutional interest.

Memorable Quote:
"Trump has promised to make America the crypto capital of the world, using his words. And this is now a $3 trillion market cap space. And... the energy and regulatory, political and venture capital momentum is palpable. You cannot miss this." – John Bowman [12:00]

2. Crypto & Capital Allocation: The Institutional Hesitations

[00:00–23:44]

Three Main Hurdles for Institutional Adoption

• Identity Crisis: Is crypto a commodity, security, or something else entirely? Narratives swing from “digital gold” to high-risk, high-return assets.
  • “If anyone ever is pitching any opportunity as all those things at once, run far away.” – John Bowman [09:30]
• Valuation Challenge: Bitcoin's scarcity (21 million supply) makes it compelling on paper, but rising correlation with equities raises doubts about its diversification value.
• Infrastructure Gaps: Concerns over custody, prime brokerage, regulatory support, and the reliability of platforms like Coinbase for large fiduciaries.

Historic “Mic Drop”

• At a 2021 asset owner roundtable, Duke’s Cam Harvey argued:
  • “Even if you don’t have direct exposure to defi or crypto, you may be implicitly shorting it by owning legacy technologies in business models... if you’re not long, you’re probably short." [06:30]
• This forced allocators to consider crypto risk exposure, even passively.

3. The Four Stages of Crypto’s History

[16:39–43:56] Bowman lays out a four-phase framework:

1. Primitive Stage (Pre-Bitcoin, 1983–2008)

• Early digital cash like David Chaum’s "blind signatures," Nick Szabo’s "bit gold" (mining, timestamps), and Adam Back’s "hashcash." These innovations seeded Bitcoin’s architecture.
• Notable: Common speculation Szabo is Satoshi Nakamoto—never denied by all parties.

2. Novelty Stage (2008–2017)

• Satoshi publishes the white paper & disappears (rumored to own 1M Bitcoin).
• First real transactions (famous “Bitcoin Pizza Day,” where 10,000 BTC bought two pizzas—now worth billions).
• Entry of institutional funds (Pantera, Fortress), launch of Ethereum ("smart contracts" for DeFi), and business integrations via PayPal, Microsoft, etc.

3. Eyebrow Raising Stage (2017–Early 2021)

• Crypto enters mainstream discourse; major financial leaders (Buffett: “rat poison,” Munger: “venereal disease,” Dimon: “fraud,” Fink: “zero interest”) attack.
• Iconic venture funds launch (A16Z, Morgan Creek).
• First significant institutional allocations by public pensions (Fairfax County) and Ivy endowments (Yale, Harvard et al.).
• Major trading blocks (One River, Coinbase), IPO of Coinbase.

4. Schizophrenia Stage (2021–Early 2024)

• Explosive growth & hype (NFT crazes, Super Bowl ads, wild price action), but also catastrophic failures (Terra/Luna, 3AC, FTX, etc.).
• Regulatory crackdown (Gensler’s SEC, lawsuits, enforcement, criminal charges).
• Desperate need for regulatory clarity and new frameworks emerges.

Notable Quote:
"Transformative technologies like crypto and AI require us to separate their essence from specific uses and misuses. A hammer can build a home or demolish one." – Chris Dixon, A16Z [38:37]

4. The Inflection Point: Is January 2024 the Dawn of the Golden Age?

[Pre-43:56]

• Spot Bitcoin ETFs are approved; $100B in AUM across products from BlackRock, Galaxy, Fidelity, etc.
• ETH ETFs soon follow.
• The 2024 election unleashes a wave of pro-crypto policy and industry appointments (e.g., Paul Atkins as SEC chair, Bitwise’s David Sacks in the White House).
• Major institutional allocators like BlackRock add Bitcoin to their strategic allocations; sovereign wealth funds (Mubatala), U.S. state funds, and Japan’s GPIF explore or begin direct exposure.

5. Aaron's Analysis: The BTC Framework

[43:56–61:29] Aaron Filbeck breaks down institutional adoption:

B = Broad Adoption

• Market is still heavily retail: ~70% of Bitcoin holders are individuals, ~12% are lost or yet to be mined, and only 6% each are held by funds/ETPs and businesses/government.

T = Tales of Sentiment

• Surveys post-ETF approval (EY): 94% of institutional investors are long-term believers; 2/3 are invested via vehicles with crypto assets, typically 1–5% allocations.

C = Current Journey

• Sovereign/Public Funds: Most exposure via infrastructure (equities in Coinbase, Tesla, MicroStrategy) and venture, not direct tokens. After “burns” like FTX, direct allocations are rare but increasing.
• Endowments/Foundations: Early adopters used venture, now starting to buy ETFs (e.g., Emory University). Majority remain cautious or uninterested.
• Wealth Channel: Family offices more aggressive, yet major splits in sentiment; RIAs/Wirehouses/IBDs show rising, but still minority, participation (improving year on year).

Key Obstacles:

• Unclear venture exit environment, frothiness/meme-coin distractions, and (until recently) product & regulatory instability.

Memorable Quote:
"If you're an optimist and a bull... there's a lot of infrastructure that's been put in place. If you have some regulatory clarity, there's a lot there." – Aaron Filbeck [61:29]

6. Spotlight on Product Evolution, Integration & Regulation: Coinbase + BlackRock

[69:29–103:37]

Coinbase’s Journey (Greg Tussar)

• Early days: Built out institutional-grade trading (via Tagomi, then Coinbase Prime), with custody & trade execution on one platform.
• Massive crypto block trades (One River) marked the first “product-market fit” for institutions around 2020.
• Post-bear cycles, Coinbase doubled down on asset management (acquired One River)—a directional bet on “eventual adoption,” not a reaction to immediate flows.
• Current focus: Building out full prime brokerage-like experiences, derivatives, and infrastructure for long/short, portfolio solutions for quants.

BlackRock’s Stance (Robby Michnick)

• Early asset owners favored “picks & shovels” (infrastructure, equity, or VC) due to lack of operational ease and clarity, but many regret missing direct Bitcoin’s performance.
• BlackRock’s “Sizing Bitcoin in Portfolios” research uses a volatility-contribution model (reference: Mag 7 stocks)—suggests 1–2% allocation is justifiable as a start.
• Noted the “self-inflicted wound” of the crypto industry pushing the “risk-on” narrative, muddying the diversification case for institutions. Industry needs to mature its communication.

Notable Exchange:
"What's interesting is that the periods of elevated correlation that we've seen recently in my view are almost entirely a self inflicted wound. It's actually incredible to see how much damage the industry has managed to do to itself by leaning into this risk on risk asset narrative [...]." – Robby Michnick [86:30]

Regulatory Frameworks & the Path Forward

• Both guests: Strongly support the need for clear, federal-level regulation (not a “Wild West,” but not draconian overreach).
• Coinbase (Greg): Advocates for clear token taxonomy (security vs. commodity), CFTC spot market authority, robust stablecoin and DeFi frameworks, and “clarity so all parties can safely build their businesses.”
• BlackRock (Robby): Echoes this, noting the U.S. is shifting from enforcement to genuine guidance. There may be surprises—regulation is coming, not being lifted.

Global Perspective:

• Asia, the Middle East, and Bermuda are leading some US counterparts in pragmatic, investor-protective, yet innovative regulation—U.S. could and should learn from these markets.

7. Conclusions, Reflections, and Takeaways

[103:37–End]

Regulation & Institutionalization

• True institutional adoption needs more than hype or access—it requires:
  • Mature and responsible industry narratives and frameworks
  • Regulatory clarity focused equally on innovation and investor protection
  • Real diversification properties, not just speculative upside

Are We in the “Golden Age” Yet?

• Major strides made: spot ETFs, large asset manager allocations, policy momentum, headlines shifting from FOMO to frameworks.
• But adoption is still “directional," not "universal"—headlines outpace allocations, and product evolution is ahead of genuine, pervasive institutional sentiment.
• The next 12–18 months will be telling as regulatory clarity emerges and more product “track records” are established.

Biggest Takeaway Quotes:

"If you want to play at the adult table per se, at a BlackRock or at Franklin Templeton... you have to be able to answer these questions without getting defensive or without name calling or mockery." – John Bowman [108:15]
"You can’t expect broad adoption if it’s a clubby atmosphere that’s dominated by this niche group of people." – Aaron Filbeck [108:45]

Key Timestamps

• Crypto Institutional Hesitation & “Mic Drop” Quote: 06:30
• Stages of Crypto History (Bowman’s Framework): 16:39–43:56
• ETH Spot ETF Approval & Policy Changes: 43:56
• BTC Institutional Adoption: Broad Sentiment & Product Structures: 44:40–61:29
• Coinbase & BlackRock: Candid Guest Segment: 69:29–103:37
• Takeaways & Reflections: 103:37–End

Memorable / Notable Quotes

• “Even if you don’t have direct exposure to defi or crypto, you may be implicitly shorting it by owning legacy technologies in business models. In other words, if you’re not long, you’re probably short.” – Cam Harvey, via John Bowman [06:30]
• “It cannot be all of these things at once. And by the way, if anyone ever is pitching any opportunity as all those things at once, run far away.” – John Bowman [09:30]
• “[The] key for investors is to recognize that it’s highly volatile. This is Bitcoin, very speculative, a poor diversifier, and there’s no free lunch.” – Anna Shelley, AMP [12:10]
• "What's interesting is that the periods of elevated correlation that we've seen recently in my view are almost entirely a self inflicted wound. It's actually incredible to see how much damage the industry has managed to do to itself by leaning into this risk on risk asset narrative." – Robby Michnick [86:30]
• “If you have a long-term view about when this is fully embraced... you have to play the long game, you have to invest in all the meetings and all the things that lead up to the moment.” – Greg Tussar (Coinbase) [78:53]
• “Up till now, the U.S. hasn't had any regulation. ... What we're going to see now actually is more regulation. And there may be some surprises—people who thought that what this whole new regime meant was everything goes, I think they're going to be disappointed.” – Robby Michnick [99:16]
• “We’d rather go slow and do it right than rush and find... we have to clean up a mess after.” – Tony Davidow (Halftime) [68:00]

Conclusion: For Those Who Haven’t Listened

This episode is an in-depth masterclass on the evolution and state of institutional crypto adoption—balancing historical context, current architecture, product options, industry psychology, and regulatory realities:

• The industry is at an inflection point, with unprecedented access, product innovation, and government attention.
• Yet, headlines and hype still somewhat outpace actual institutional flows and conviction.
• Candid, nuanced perspectives from both major innovators (Coinbase) and institutional behemoths (BlackRock) reinforce that a true “golden age” depends not just on product or price, but on responsible industry behavior and clear, pragmatic regulation.

If you want to understand how asset owners, pensions, endowments, and wealth managers are actually engaging with digital assets—and what might come next—this episode is essential listening (and now, reading!).