Pantera Capital: cryptocurrencies such as Bitcoin have the lowest correlation with traditional assets, and investment is recommended to diversify portfolios

According to Bitcoinist, hedge fund Pantera Capital believes that cryptocurrencies such as Bitcoin represent a new asset class that has the lowest correlation with traditional assets and is one of the best performing asset classes of the year. The fund advises investors to diversify their portfolios by allocating a portion of their portfolio to cryptocurrencies. Pantera CEO Dan Morehead said in a letter from Medium that the bitcoin and blockchain businesses have little relevance to other asset classes. He showed three-week (second quarter 2016 – second quarter of 2019) weekly returns and proved that bitcoin is almost irrelevant to traditional assets such as stock indices and commodities. Morehead said there was little correlation between traditional asset classes such as bonds, currencies and commodities in the 1980s. However, investors are beginning to realize the potential of diversification and ultimately manage a similar portfolio. For retail and institutional investors, Bitcoin and the entire blockchain ecosystem are like breathing fresh air. They are great not only because they can keep their wealth in times of great crisis, but also because they can bring considerable returns no matter what happens elsewhere. If you can find an 8-year compound annual growth rate of 235%, and basically have no correlation with any other assets, you should have some.