Key Insight from Bitcoin for Institutions: 5. Institutions must understand why individuals value bitcoin to successfully integrate it into their strategies. Chapter: Introduction

Bitcoin for Institutions | Math Academy

Interactive course on Bitcoin for institutional investors

""A bearer asset is a type of financial asset where ownership is determined by physical possession, rather than by registration or the holder's identity. In the past, traditional bearer assets included cash, because back in the gold standard era, cash represented a claim on the Central Bank gold reserve."" — Brian Hirschfield From: Bitcoin is a Bearer Asset

Bitcoin for Institutions | Math Academy

Interactive course on Bitcoin for institutional investors

""Holding a bitcoin treasury and using it in lieu of ETFs is a superior strategy that eliminates the counterparty credit risk entirely."" — Brian Hirschfield From: Deferred Compensation - Riding the Wave

Bitcoin for Institutions | Math Academy

Interactive course on Bitcoin for institutional investors

Key Insight from Bitcoin for Institutions: 5. Convertible debt enables leverage - Strategy pioneered using corporate finance to accelerate bitcoin accumulation. Chapter: Strategy (Balance Sheet Strength)

Bitcoin for Institutions | Math Academy

Interactive course on Bitcoin for institutional investors

Authenticity Risk Gold and silver bars must be verified to ensure they are not just gold-plated tungsten. From: Bitcoin for Institutions

Bitcoin for Institutions | Math Academy

Interactive course on Bitcoin for institutional investors

Con: Fast-Track Adoption BlackRock spent the majority of the last decade hating bitcoin until 2023. They wanted to fast-track their adoption, choosing speed over security. From: Bitcoin for Institutions

Bitcoin for Institutions | Math Academy

Interactive course on Bitcoin for institutional investors

Phase 1: ETF-Based Program Start with ETFs (IBIT, FBTC) to get the program operational. This is the fastest path to offering bitcoin in NQDC. From: Bitcoin for Institutions

Bitcoin for Institutions | Math Academy

Interactive course on Bitcoin for institutional investors

""Cryptography is ruthless, and there are two types of people in the world — those who have been burned and those who have yet to be."" — Brian Hirschfield From: Bitcoin Custody Requires a Higher Understanding of Tradeoffs

Bitcoin for Institutions | Math Academy

Interactive course on Bitcoin for institutional investors

Bitcoin Parallel The market doesn't know how to value Strategy (MSTR) because they don't know how to associate value with their bitcoin treasury. Same problem, new asset. From: Bitcoin for Institutions

Bitcoin for Institutions | Math Academy

Interactive course on Bitcoin for institutional investors

Key Insight from Bitcoin for Institutions: 3. Accounting standards shape behavior - FAS87's treatment of pensions caused irrational equity allocations, just as goodwill treatment discouraged bitcoin treasury adoption. Chapter: Epilogue

Bitcoin for Institutions | Math Academy

Interactive course on Bitcoin for institutional investors

Clear Communication Investors need to understand bitcoin's role in the fund and why temporary drawdowns don't indicate failure. From: Bitcoin for Institutions

Bitcoin for Institutions | Math Academy

Interactive course on Bitcoin for institutional investors

Key Insight from Bitcoin for Institutions: 2. Bitcoin requires multi-disciplinary knowledge —economics, computer science, history, mathematics, game theory, and cryptography. Chapter: Bitcoin Requires More Patience and Time than Institutions Have

Bitcoin for Institutions | Math Academy

Interactive course on Bitcoin for institutional investors

Key Insight from Bitcoin for Institutions: 3. Bitcoin collateral redefines subordination - behaviorally, it becomes the most senior loan regardless of contractual priority. Chapter: Structured Credit

Bitcoin for Institutions | Math Academy

Interactive course on Bitcoin for institutional investors

Operating Profitability Operating revenue less operating expenses - what the company expects to experience on a "run-rate" or under typical conditions. From: Bitcoin for Institutions

Bitcoin for Institutions | Math Academy

Interactive course on Bitcoin for institutional investors

The Required Pivot The contrast in purchasing power will require institutions to focus more on Future Value as opposed to Present Value. This pivot will be much more intuitive for individuals to adopt than institutions. Institutions will need to understand the time and risk preferences of individuals, and how bitcoin is already reshaping them. From: Bitcoin for Institutions

Bitcoin for Institutions | Math Academy

Interactive course on Bitcoin for institutional investors

Key Insight from Bitcoin for Institutions: 4. IBIT broke every ETF record - fastest to $10B, $20B, $30B, $40B, and $50B in assets under management. Chapter: BlackRock (Redefining Portfolio Construction)

Bitcoin for Institutions | Math Academy

Interactive course on Bitcoin for institutional investors

HODL'ing requires a willful ability to be irrational or unreasonable. This ability is difficult to model into software, and even more difficult to execute through corporate or institutional governance, where reputations are built and destroyed at these crucial points. Human action is based on an individual's unique set of circumstances at a given moment— specifically, the largest source of dissatisfaction that can be removed at the lowest cost. This is the water/diamond paradox : a person would forgo all the diamonds in the world for their first glass of water. At an institutional level, the decision to remove the largest source of dissatisfaction stems from the human beings who have the pow... From: HODL'ing Bitcoin is Irrational

Bitcoin for Institutions | Math Academy

Interactive course on Bitcoin for institutional investors

The 2022 Reality "Risk-free" assets lost 30-50% of value. The foundation of portfolio construction was revealed to be an illusion. From: Bitcoin for Institutions

Bitcoin for Institutions | Math Academy

Interactive course on Bitcoin for institutional investors

Pensions are the king when it comes to OPM expertise. By OPM, I mean "Other People's Money." Everybody is an expert on how to manage other people's money, and nothing brings out people's greatest and wildest ideas like pensions. There is very little written about pensions that is truly original - but as an actuary with 30 years of experience who understands both pensions and bitcoin deeply, some insights can be offered. From: Pensions

Bitcoin for Institutions | Math Academy

Interactive course on Bitcoin for institutional investors

Key Insight from Bitcoin for Institutions: 2. Small allocations generate significant alpha - even 1-2% bitcoin can meaningfully improve portfolio Sharpe ratios. Chapter: Mutual Funds / ETFs - Wielding the Blade

Bitcoin for Institutions | Math Academy

Interactive course on Bitcoin for institutional investors