- Blackrock’s new report revealed that companies strongly believe in holding BTC in their wallets.
- Private investors showed interest and reached an all-time high.
Major banking institutions and funds have criticized Bitcoin[BTC] for a long time. However, the situation has recently changed. These funds not only support Bitcoin, but also recommend adding it to investment portfolios. This renewed support from influential financial entities could have significant implications for Bitcoin adoption going forward.
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Blackrock remains bullish
Recently, global fund manager BlackRock made headlines recently when cryptocurrency analyst and trader Michael van de Poppe shared a screenshot of a BlackRock document on social media.
Analysts at Blackrock state that a portfolio of optimal risks comprises 84% #Bitcoin.
Still, you think we’re going to $12K.
I just buy more. pic.twitter.com/3oHRSwppiR
— Michael van de Poppe (@CryptoMichNL) July 26, 2023
The document, titled “Asset Allocation with Crypto: Application of Preferences for Positive Skewness,” revealed that BlackRock recommends an impressive 84.9% allocation of BTC in a high-risk portfolio. Conducted in April 2022, the study monthly analyzed Bitcoin’s performance as an asset from July 2010 to December 2021.
According to BlackRock’s findings, for a portfolio of 60-40 (60% stocks and 40% bonds), the optimal allocation of BTC is 84.9%. This left the remaining 15.1% to be split between stocks and bonds in a 60-40 ratio. Although the study was written last year, it has recently gained significant popularity on Twitter.
This recommendation from BlackRock underscores Bitcoin’s growing recognition as a potentially valuable component of a diversified investment portfolio.
Will history repeat itself?
The importance of the study extends to the potential implications for BlackRock’s promotion of Bitcoin once the spot ETF gains approval from the SEC. It draws parallels to the first gold ETF story, which could repeat itself for Bitcoin.
In particular, after the introduction of the first gold ETF in 2004, the gold price has increased fivefold. This impressive growth was due in part to BlackRock’s global financial advisors. They strongly advocated an allotment of 5% gold as an essential part of any portfolio.
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Given this historical precedent, BlackRock’s support and promotion of Bitcoin through ETFs could play a critical role in driving further adoption and potentially impact Bitcoin’s market dynamics going forward.
Private investors are not shying away
Not only institutional investors showed interest in Bitcoin, there was also optimism among private investors. According to Glassnode data, the number of addresses holding more than 1 Bitcoin had reached an all-time high at the time of writing.
Source: glassnode