Old money doesn’t ruin the cypherpunk dream

Even the most red-fevered crypto-anarchist must admit by now that the direction of travel is set: Institutional money is coming

OPINION
article-image

Midjourney modified by Blockworks

share

Calling blockchain and its associated technologies an “industry” is, to some, still an insult. To call it a “sector” is too dismissive, an “asset-class” too reductive. How about: Prophets of a new sacred social covenant? Defenders of libertarian finance? Acolytes of a decentralized faith? Trustees of the trustless? A belief in the wisdom of crowds.

For the longest time, crypto has served as an alternative institution: Whether it’s for finance, art or community, it’s considered a tokenized counter-cultural movement. Permissionless, trustless, decentralized, open, embracing the fringe — a community where everyone is welcome, and no one can tell us what to do.

Yet even the most red-fevered crypto-anarchist must admit by now that the direction of travel is set. Whatever primitive emancipation certain users experienced from the traditional financial system through crypto is fading. 

Old money is coming, and global finance is moving on-chain. 

The idea that crypto can become a mainstay social force without old money is quaint. Like it or not, these financial behemoths run the world. If there is to be a new on-chain, decentralized internet financial system, then established paradigms of money management that are backed to the hilt by legislative structures have to be involved. It’s by taking advantage of crypto’s unique properties through these institutional structures that will allow crypto’s potential to truly flower.

And even a blind man can see old money’s interest in crypto. 

ETFs are a huge gateway drug to this adoption. Crypto has waited with baited breath on the result of applications led by BlackRock and co. Even pension funds are opening to bitcoin, with Fidelity, the largest US-based 401(k), leading the charge. In fact, many believe the accumulation is well-underway and the only reason why we haven’t dropped lower — remember bitcoin (BTC) at $15K post FTX slump? ETFs might signal only the starting gun — not the moon push many expect. That will come later, when every single financial account manager finds they need to offer 5% exposure because everyone else is doing it.

Read more from our opinion section: DeFi has a reputation problem

Has crypto failed to build an alt financial system? Is crypto straight up replicating centralized finance, now even more so by using traditional finance liquidity? Yes and no. Crypto is like water, it adapts to the shape of the glass. Should an institution want to add BTC to its balance sheet, it can — whether through an ETF or via self-custody off a P2P exchange. Should you want to live CEXless and own your coins in kind, you can. The Infinite Machine is now mature enough to take any shape assigned. To some, it’s not about breaking free of Wall Street, but about catering to it. To others, it’s about living the on-chain life.

Then, if TradFi goes all in, what does this world look like?

Soon enough, DeFi TVLs will be boosted by pension fund buy-ins, ticker tapes for derivative baskets of cryptos will roll daily across Bloomberg News and investment shops will let Mom n’ Pop buy indexes that track the entirety of the shitcoin spectrum. Banks won’t just let you buy crypto — they’ll buy it with your retail savings and give you 3% a year.  

Eventually, if not imminently, investment banks will trade NFT portfolios over their OTC desks. Some bright young thing in a whip-sharp suit will concoct synthetic CDOs and credit default swaps on tranches of CryptoPunks, and before you know it, grandma’s pension fund will own apes. Ultimately, we’ll all have apes. Or be apes — fractal pieces of ownership in the crystalline structures of global finance. Tokenized assets, mutual funds, ETFs. These indexes that track whole markets have a fungibility and legitimacy that can’t be achieved any other way. They are, in short, what people truly mean when they say “adoption.”

But wait, isn’t crypto replete with problems? Scams, hacks, unclear regulation, the grave freedom that is self-custody. They are problems institutional money was invented to solve, yet crypto solves and does things iMoney only can at great expense and with enormous inefficiency: settlement risk, remittance, HFT, exchange fee handling, dividend payout, payment processing, insurance arbitrage. The list is as long as the financial service sector itself.

An influx of retail money channeled through financial scions will create the predictable yields that let innovation truly prosper. Everyone will take mainstream finance crypto projects seriously. Innovation will, newly minted, go into overdrive. A whole cabal of investors, entities that sit currently outside the angel and VC edge cases that are the current primers of any crypto run, will be looking for Web3 projects to make sustainable, long-term investments in. 

Crypto, whether you like it or not, is going to become an industry, and — if it truly proves the widespread utility it has claimed, especially as scaling challenges are met and bad actors are flushed out — might be all the better for it.



Get the news in your inbox. Explore Blockworks newsletters:

Tags

Upcoming Events

Old Billingsgate

Mon - Wed, October 13 - 15, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

Industry City | Brooklyn, NY

TUES - THURS, JUNE 24 - 26, 2025

Permissionless IV serves as the definitive gathering for crypto’s technical founders, developers, and builders to come together and create the future.If you’re ready to shape the future of crypto, Permissionless IV is where it happens.

Brooklyn, NY

SUN - MON, JUN. 22 - 23, 2025

Blockworks and Cracked Labs are teaming up for the third installment of the Permissionless Hackathon, happening June 22–23, 2025 in Brooklyn, NY. This is a 36-hour IRL builder sprint where developers, designers, and creatives ship real projects solving real problems across […]

recent research

Featured.png

Research

Helium stands at a pivotal moment in its evolution as a decentralized wireless network, balancing rapid growth, economic restructuring, and global expansion. With accelerated growth in domestic DAUs and Hotspots supporting its network, Helium is leveraging strategic partnerships and innovative proposals to scale internationally. The recent implementation of HIP 138, “Return to HNT,” has unified its token economy under HNT, simplifying participation and strengthening liquidity, while HIP 139’s phase-out of CBRS refocuses efforts on scalable Wi-Fi offload. Meanwhile, governance shifts under HIP 141 raise questions about centralization as Nova Labs consolidates control over the roadmap.

article-image

In 2011, WikiLeaks faced a financial blockade imposed by the US government. It was Bitcoin’s first major test.

article-image

Kado’s founder Emery Andrew spoke to Blockworks about the acquisition and what’s next for the team

article-image

LayerZero’s Bryan Pellegrino chatted with Blockworks about the firm’s next steps and its 10-year runway

article-image

Colosseum co-founder Matty Taylor is seeing “high-performance [Solana] founders showing a lot of interest in private trading technology”

article-image

Executives weigh the growth potential they see in the public stock and private credit/equities arenas

article-image

Players can stake ME, trade tokens and link wallets to climb the leaderboard