Blockchain technology offers a new model of trust—embedded not in centralized authorities but in decentralized networks. Yet despite its technical strengths, blockchain governance remains fragmented and incomplete. This article advances a distinct perspective: treating blockchain as an institutional innovation through the lens of New Institutional Economics. We systematically compare private and public ordering across rulemaking, monitoring, enforcement, and conflict resolution, and propose a hybrid regulatory model that is not designed to contain, but to unlock blockchain’s potential. While private actors, through coordination and cooperation, can build effective governance systems, public ordering remains indispensable. It provides predictability, external legitimacy, protection against externalities, and reduced transaction costs—factors decentralized systems often cannot guarantee alone. Rather than constraining innovation, regulation can enable it. International accounting standards (IFRS) offer an illustrative model for rule-setting by private organizations. We offer a pragmatic blueprint for blending bottom-up adaptability with top-down predictability in a hybrid regulatory approach. This functionally integrated approach allows blockchain to evolve as a scalable, legitimate, and socially embedded infrastructure—anchored in both technical ingenuity and robust institutional design.