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Developers who wrote code alongside Bitcoin's earliest contributors. Family offices still deciding whether to allocate to it at all. Members who arrived a decade ago, and builders who've spent years working on top of the network since. That was the range of the room at the first Xapo Bank Summit.
On 1 July, we welcomed 255 members, partners, and guests to the Chancery Rosewood in London. One hundred and eighty of them travelled in, along with 31 of our 38 speakers, for a single day of conversation about Bitcoin, held in a market that was giving nobody easy answers.
Our CEO, Seamus Rocca, opened the day discussing the space’s evolution: the industry has matured well past the hype of crypto‘s early gatherings, now laser-focused on furthering the frontiers of Bitcoin utility..
Michael Saylor: capital, credit, and money
Michael Saylor spent his session offering his perspective on BTC adoption: Strategy's approach to capital, credit, and money.
Saylor's framework has three layers. Bitcoin is digital capital, the base. Credit is written against that capital, and money is written against the credit. The middle layer matters, he argued, because raw Bitcoin asks a great deal of its holder: a four-year time horizon, forty per cent volatility, and no cash flows along the way. Most of the world's capital is managed by people who will never accept those terms, and credit is the instrument that has always translated between assets like that and investors like those.
None of this is novel, he was careful to point out. The Bank of England was chartered in the 1690s as a company capitalised to buy gold and issue credit against it, and the City of London is what grew on top of that arrangement.
Building on a settled base layer
Our Executive Director, Joey Garcia, moderated a panel on where Bitcoin infrastructure goes next.
Conner Brown of the Bitcoin Policy Institute, the Washington think tank that advises legislators and states on how Bitcoin should be treated in law, began at the widest angle. The asset changes character with the holder, he said: personal savings for an individual, a capital asset for a company, a reserve for a state. The Institute has spent recent months answering detailed questions from central bankers in Asia, which is a long way from where that conversation was even three years ago.
If states are going to hold Bitcoin, the question that follows is what secures it in fifty years, once the block subsidy has largely gone. Diego Gutierrez Zaldivar, who co-founded Rootstock, the first smart contract platform built on Bitcoin, offered one answer. Rootstock runs as a sidechain secured by merge-mining, so Bitcoin miners can secure it with hardware they already own and collect the fees it generates. Extend that to banks and payment networks settling their own traffic against Bitcoin, and fee income begins to look like a durable replacement for the subsidy. He was equally firm on why the underlying security model matters: proof of work is anchored in physical limits, where staking allows an attacker to short the very asset they are attacking.
Daniel Jonsson of the MGMT Digital Infrastructure Fund approached the same economics from the energy side. Mining is moving away from assembling cheap megawatts in one place and towards the edges of the grid, where power would otherwise be stranded, waste heat can be recovered to warm buildings, and grid operators will pay for balancing services. A miner earning from three revenue lines rather than one is a more resilient miner, and so is the network behind it.
BTC insurer Meanwhile offered a unique perspective on Bitcoin utility. The Bermuda-regulated company was the first life insurer to operate entirely in Bitcoin, and its CEO, Zac Townsend, described a business that takes premiums in Bitcoin, holds its reserves in Bitcoin, and files its actuarial mathematics and audited accounts in Bitcoin. Life insurance, as he put it, was the original hodl. It is also a business that cannot be built by anyone who thinks the base layer might not be there in thirty years.
Adam Back: the long view, and a reality check
Nobody in the building had watched that base layer for longer than Adam Back, who joined Nikita Sachdev of Luna PR for a standing-room-only session.
He took the room back to the cypherpunk mailing lists of the 1990s, to DigiCash and its fatal dependency on a central issuer who could inflate the supply undetectably, and to hash cash, his own 1997 proposal for a postage stamp that made email spam expensive. The insight that mattered later, he said, was that a peer-to-peer network cannot open a bank account, which is why the coins have to be mined. When Satoshi's draft landed in his inbox in August 2008, he could see the known problems had been solved. His open question was not whether the design worked, but whether anyone would use it.
That long view produced the most useful correction of the day. Institutional adoption, in his reading, is real and still early. The model portfolios that generated headlines have not yet been deployed into managed funds at scale, because the process is slower and more bureaucratic than the market appreciated, which means most of that capital is ahead of us rather than behind. Our Asia panel reached the same conclusion from the opposite direction, noting that institutional exposure in the region arrives largely through exchange-traded products and listed treasury companies, and that three years ago neither existed.
Bitcoin per share, or the current ratio?
That gap between arrival and deployment shows up most visibly in listed markets, which is where Henri Arslanian's panel on Bitcoin capital markets began.
Two years ago there was essentially one Bitcoin treasury company. There are now more than a hundred, competing on what they build around the holdings rather than on the holdings themselves, and Europe is where several of them expect the next wave of demand: corporate credit there runs to trillions of euros, with high-yield indices paying around five per cent.
The sharpest observation came from the panellist who first proposed a Bitcoin allocation to a US public pension fund in 2019 and got it approved in 2021. Bitcoin-native investors, he pointed out, measure these companies in Bitcoin per share. Credit investors measure them by the current ratio. Both questions are legitimate, and a good deal of the recent volatility in that sector is the second group asking one the first had not prepared an answer for.
What to do in the meantime
For an allocator, the practical question is what to do while that capital finds its way in, and our asset management panel, hosted by our Head of Investments Gadi Chait, was unanimous on the answer.
Market structure shifted last October. Strategies that had worked reliably stopped working, and the distance widened between managers with genuine risk processes and those who had been carried by favourable conditions. Their view for the remainder of the year was consistent: stay inside the mandate, and resist the temptation to make up a quiet quarter with yield nobody can adequately explain. The worst thing available in a market like this one, as one speaker put it, is to sit in front of a screen and over-trade in search of something that is not there.
Everything looks like a failure in the middle
Which made it fitting that we closed somewhere less predictable, with Professor Damian Hughes of the University of Manchester, joined by legendary sportsmen Alan McInally and Mike Tindall.
Hughes walked the room through Kanter's Law: every change effort looks like a failure at its midpoint, when you are too far in to see the end and too far in to turn back. That is where morale falls, patience runs out, and people leave. His examples came from elite sport, including the player who sat down with her psychologist to identify in advance every setback likely to derail her, and who wrote the word "smile" on the spine of her racket so she would meet the first one differently. For a room that has held Bitcoin through five drawdowns in five years, it was the least abstract session of the day.
To the members who joined us, thank you. The conversations you had with our team, on custody, on the cycle, and on what you want this bank to build next, shaped more of our thinking than any panel did. The Summit will be annual, and we hope to see more of you in the room next year.
