Have you heard? “increased adoption” Answers to the question “What do you expect from 2025’s crypto market?” are plentiful.
BTC is a popular choice for big companies, not just retailers.
BlackRock’s advice earlier in the month, while different to each investor, gives a good idea of what a possible buying spree could look like.
While Donald Trump’s nomination of a new SEC Chair and another rate cut by the Fed dominated the news in December, many may have overlooked the announcement. “investment perspectives” edition.
BlackRock execs reported a few weeks ago that in an investment portfolio consisting of 60% bonds and 40% stocks, each of the seven so-called “Magnificent Tech Stocks” accounts for about the same amount of portfolio risk on average as a BTC allocation between 1-2%.
“We think that’s a reasonable range for a bitcoin exposure,” Additions to the list include:
Galaxy CEO Mike Novogratz saw this guidance and reacted accordingly:
Matt Hougan Bitwise CIO noted, in a X-space he wrote a few weeks later, that this news had gone unnoticed.
It was sort of funny, Hougan added — “not just that people missed BlackRock saying you should add bitcoin to a portfolio, but all of a sudden we doubled the allocation.”
Hogan makes reference to the not uncommon 1% investment in bitcoin by those who’ve jumped on the bandwagon. According to a survey conducted in March, of those financial advisers investing into the bitcoin space, 15 percent recommended that their clients make a 1% investment. Of those who planned to do so, 23% said that they expected to start out with an allocation of this size.
Many investors Bitwise speaks with opt for a 5% allocation, Hougan added — a level he noted would often get you laughed at a year ago.
“[It’s] not just 2% for a few people at a wealth manager; [it’s] 2% for the base rate for a portfolio across every exposure,” A BlackRock guide was mentioned by him. “I think it’s really significant, and if you think it’s the end of the story, you’re wrong.”
While US Bitcoin ETFs helped many wealth managers get into the crypto world, others haven’t. There are also other institutions interested in crypto, such as companies, pension funds, or governments.
Hougan stated that as Bitcoin volatility decreases in the next year or so, BlackRock may recommend allocating 5% of their portfolio to BTC.
BlackRock execs indeed note that wider adoption and trading could make BTC’s low correlation with equities more stable — trimming the asset’s contribution to portfolio risk and enabling investors to up their position in it.
“Yet broad adoption could also mean bitcoin loses the structural catalyst for further sizable price rises,” They explain. “The case for a permanent holding may then be less clear-cut and investors may prefer to use it tactically to hedge against specific risks, similar to gold.”
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