Why institutional infrastructure matters for bitcoin adoption

The step from an exchange account to full self-custody almost never follows a straight line. Many bitcoin holders find themselves somewhere in between: they understand why custody matters, but struggle with the practical execution. As bitcoin finds its place in institutional portfolios, it becomes clear that infrastructure must acknowledge this reality.

In a recent conversation with Stephan Livera and Jos Lazet, CEO of Blockrise, discussed why this balance between security and usability matters so much, especially as recent price movements showed once again what many bitcoiners already knew: volatility remains part of the story.

The market recalls old lessons

When bitcoin fell from above $100,000 back to $60,000, more panic emerged than expected. What stands out is how many participants now have exposure through bitcoin-backed lending. Leverage amplifies consequences, and as more people use these services, more people feel the impact of price movements.

The four-year cycle has not disappeared, only shifted. Where new all-time highs previously came six to twelve months after the halving, this time we reached the record beforehand. That gave some the feeling that volatility had vanished. The market corrected that assumption. Volatility remains a given for the coming years. Infrastructure that must enable institutional adoption needs to work with it.

A bridge between two worlds

Most people begin their bitcoin journey at an exchange. Some take the step to a wallet on their phone. A few build multi-signature setups with hardware wallets distributed across multiple locations. Between those last two steps lies a wider gap than the bitcoin community sometimes wants to acknowledge.

Blockrise Capital B.V. operates with a semi-custodial model under MiCAR regulation. The architecture uses hardware security modules in which keys are generated that cannot be extracted. Clients generate authentication keys needed to approve transactions. Neither party can unilaterally control the bitcoin. Everything remains verifiable on-chain per service used.

This model targets those who want more certainty than exchange custody provides, but cannot or will not bear the operational burden of multi-signature coordination. For family offices considering bitcoin, or for people with large positions without technical infrastructure, this offers verifiable security with recovery procedures that family can execute when needed.

Lending outside the banking system

European banks cannot economically play a meaningful role in bitcoin-backed lending at this time. Basel III makes bitcoin as collateral 44 times more capital-intensive than a residential mortgage. The space banks leave behind is being filled by private debt markets.

Blockrise Lending B.V. offers bitcoin-backed loans in euros as a group company. The structure is conservatively designed: liquidation occurs at 85 per cent loan-to-value, meaning even at liquidation there remains 118 per cent over-collateralisation. A starting point of 30 per cent LTV can survive a 65 per cent price decline before liquidation threatens.

Bitcoin volatility requires margin management and reserves to top up when needed. Risk appetite determines what is sensible, not how the market looks at any given moment.

Regulation as enabler

MiCAR regulation became effective in December 2024 and provides institutional parties with a framework within which they can operate. Banks, asset managers and corporate treasuries that previously could not justify allocation to bitcoin within their legal obligations now have starting points.

Blockrise Capital B.V. offers custody, brokerage and asset management under this MiCAR framework. Lending services remain via Blockrise Lending B.V. as a group company without this regulation. Institutional adoption requires infrastructure that meets professional standards, offers transparent risk management and provides legal clarity. MiCAR is a first step towards that infrastructure in Europe.

Listen further

Jos Lazet spoke in more detail with Stephan Livera about the technical architecture behind semi-custodial custody, how the European market is developing and what plans Blockrise has for the future.

Bitcoin-backed loans are provided by Blockrise Lending B.V. A group company of Blockrise Capital B.V. Bitcoin-backed loans are not regulated under MiCAR

‍