In a candid and thought-provoking interview at San Francisco’s Presidio Bitcoin workspace, Jack Dorsey—co-founder of Block and former CEO of Twitter—raised critical concerns about the future of Bitcoin. As institutional interest in BTC surges, Dorsey warns that the cryptocurrency’s foundational principles of openness, decentralization, and permissionless innovation could be at risk.
During a rapid-fire “21 and 21” session with Haley Berkoe, Dorsey didn’t shy away from addressing the paradox of mainstream adoption: while growing involvement from financial giants like BlackRock signals validation, it also introduces the threat of institutional capture—a scenario where powerful entities shape Bitcoin’s evolution to serve their interests rather than the open network.
“It probably harms it a bit,” Dorsey admitted when asked about institutional investment in Bitcoin. “But I think it’s obvious that we’ll see more of it, and I hope that more people take on the principles of what made Bitcoin successful in the first place.”
The Paradox of Institutional Adoption
Bitcoin’s rise as a store of value has drawn unprecedented attention from Wall Street. ETF approvals, corporate balance sheet allocations, and pension fund inquiries have all contributed to BTC’s legitimacy in traditional finance. But Dorsey cautions that this embrace comes with a cost.
The core strength of Bitcoin lies in its permissionless nature—anyone, anywhere, can transact or build on the network without seeking approval. This openness is what allows developers, entrepreneurs, and everyday users to innovate freely. Yet as institutions pour in, there's a risk they’ll push for governance models, compliance layers, or technical changes that centralize control.
Dorsey emphasized this point by highlighting Bitcoin’s ability to attract even those once opposed to it:
“To be able to work on a money transmission protocol that’s entirely open […] that has converted the likes of a BlackRock or these major institutions that we railed against in the past—and now they have to turn their attention to it—and yet you still don’t need their permission to build on it […] where else can you find that?”
This tension—between adoption and autonomy—is one of the most pressing challenges facing the Bitcoin ecosystem today.
Why Relevance Matters: Bitcoin Must Be Used, Not Just Held
One of Dorsey’s most compelling arguments is that Bitcoin risks becoming irrelevant if it’s treated only as digital gold.
“I think it fails through irreverence—like it just fails to be relevant to people on a daily basis.”
He believes that for Bitcoin to thrive, it must be used in everyday transactions. A currency that sits idle in cold storage may preserve wealth, but it doesn’t drive adoption, foster innovation, or integrate into daily life.
“If it just ends up being store of value and nothing more, I don’t think it gains relevance at all. I think it has to be payments for it to be relevant on the everyday,” Dorsey said.
This perspective underscores a crucial distinction: value storage ensures survival, but transactional utility ensures longevity.
The Role of Layer 2 Solutions
While many in the Bitcoin community champion the Lightning Network as the solution for fast, low-cost payments, Dorsey remains cautious about putting all eggs in one basket.
“I think we can do better than Lightning,” he stated. “It isn’t bad—but I don’t think we just want to settle with having one Layer 2.”
His stance promotes continued experimentation. Whether through new sidechains, payment protocols, or novel consensus mechanisms, Dorsey advocates for a pluralistic approach to scaling Bitcoin’s functionality.
Open Source: The Backbone of Bitcoin’s Resilience
Dorsey repeatedly emphasized the importance of funding open-source development without exerting control. He praised initiatives like Spiral (Block’s Bitcoin-focused division), Brink, and OpenSats—organizations that provide grants to core developers working on Bitcoin infrastructure.
“Having some sort of granting ability to open-source developers is important.”
Without sustainable funding, volunteer-driven projects like Bitcoin Core face burnout and stagnation. Yet Dorsey insists that support must come without strings attached—no corporate agendas, no governance overreach.
This philosophy aligns with his broader vision: Bitcoin should evolve organically, driven by global contributors, not boardrooms.
Bridging Silicon Valley and the Bitcoin Community
The interview took place at Presidio Bitcoin, a physical workspace dedicated to fostering real-world collaboration among builders. For Dorsey, such spaces are vital.
“I think this is great because it is a bridge between Silicon Valley and all the energy down there, and Bitcoin.”
These hubs encourage face-to-face dialogue, accelerate idea-sharing, and help translate abstract concepts into tangible products—like Block’s Bitkey, a self-custodial wallet designed for mass accessibility.
Dorsey also discussed ongoing work on an open-source mining rig and chipset, reinforcing his commitment to decentralizing not just software, but hardware too.
AI and Bitcoin: A Future of Autonomous Agents
Looking ahead, Dorsey sees artificial intelligence playing a transformative role in how we interact with Bitcoin.
Imagine AI agents that autonomously manage microtransactions, pay for services, or negotiate smart contracts—all powered by BTC. But again, the key lies in permissionlessness.
“It’s all about who you’re asking permission from. Development goes faster if you have to ask for less permission.”
In this future, users won’t manually initiate every transaction; intelligent systems will act on their behalf—securely, efficiently, and without intermediaries.
Core Keywords Identified
- Bitcoin institutional adoption
- Permissionless innovation
- Store of value vs. payments
- Open-source development
- Lightning Network alternatives
- Decentralized finance (DeFi)
- Self-custodial wallets
- Bitcoin scalability
Frequently Asked Questions
Why is institutional adoption a risk for Bitcoin?
While institutional interest brings capital and legitimacy, it can also lead to calls for centralized control, regulatory compliance layers, or governance models that undermine Bitcoin’s decentralized nature. The fear is that large players may attempt to influence protocol changes or prioritize use cases (like passive holding) over broader utility.
Can Bitcoin be both a store of value and a medium of exchange?
Yes—Bitcoin was designed to serve both roles. However, achieving widespread transactional use requires scalable solutions like Layer 2 networks, user-friendly wallets, and merchant adoption. Without active use, BTC risks becoming a speculative asset rather than everyday money.
What does “permissionless” mean in the context of Bitcoin?
Permissionless means anyone can participate in the network—sending transactions, validating blocks, or building applications—without needing approval from a central authority. This principle is fundamental to Bitcoin’s decentralization and resistance to censorship.
Is Jack Dorsey against the Lightning Network?
No—he acknowledges its value but argues against relying solely on one scaling solution. Encouraging multiple Layer 2 innovations fosters resilience and prevents technological monoculture.
How can open-source developers be supported sustainably?
Through grant programs like Brink, OpenSats, and Spiral, which fund core development without imposing corporate control. Sustainable funding ensures long-term maintenance of critical infrastructure like Bitcoin Core.
What is Bitkey by Block?
Bitkey is a self-custodial Bitcoin wallet developed by Block (formerly Square). It aims to simplify ownership for mainstream users while ensuring full control over private keys—aligning with Dorsey’s vision of accessible, decentralized finance.
At the time of writing, Bitcoin was trading at $83,523. While price movements reflect market sentiment, Dorsey’s message remains clear: the true measure of Bitcoin’s success isn’t its valuation—it’s its continued relevance in people’s lives.