Bold Bitcoin Strategy by BlackRock Suggesting High Bitcoin Portfolio Allocation

BlackRock's bold Bitcoin strategy suggests high allocation to Bitcoin in portfolios.

Author: News Report, BEINCRYPTO; Translation: Songxue, LianGuai

The world’s largest asset management company, BlackRock, suggests that the best portfolio allocation is 84.9% Bitcoin.

If investors follow BlackRock’s advice, the value of Bitcoin could exceed the total value of stocks, real estate, and bonds by five times.

Despite the volatility, BlackRock still considers the positive skewness of Bitcoin as a reason for a significant allocation and dominates in the utility function.

The world’s largest asset management company, BlackRock, seems to be fully invested in Bitcoin. In addition to the recently submitted spot ETF application, the company has also recommended the best portfolio allocation for the world’s largest digital asset.

Economic analysts have been studying in-depth reports on the best portfolio allocation for risk and return before BlackRock. Their findings have a significant impact on Bitcoin, and if these recommendations are implemented, the value of Bitcoin may reach new highs.

BlackRock’s Bitcoin Drive

On July 25, Joe Burnett from Blockware commented on BlackRock’s 2022 best Bitcoin allocation report.

It is worth noting that the asset management company recommended 84.9% BTC, 9.06% stocks, and 6.04% bonds. Burnett commented:

“If all investors follow BlackRock’s best Bitcoin allocation, the value of Bitcoin will exceed the total value of stocks, real estate, and bonds by five times.”

He speculates that if the global total wealth today is approximately $800 trillion, the price of Bitcoin would reach $190 million.

Economist Alessandro Ottaviani also expressed the same view, commenting:

“Sooner or later, everyone will realize that Bitcoin is a must-have in every portfolio.”

At the time, BlackRock wrote, “Despite the significant volatility of Bitcoin, the apparent positive skewness leads to a significant allocation and dominates in the utility function.”

Analyst “PlanB” reissued his stock-to-flow model on July 25, stating that it is currently in the early stages of a bull market, and added:

“BlackRock certainly wants to buy at a low price before the ETF approval, before the second phase of a comprehensive bull market.”

Although this paper was written last year, it is now widely shared on crypto Twitter.

Outlook for Bitcoin Spot ETF

On July 25, James Seyffart, an exchange-traded fund expert at Bloomberg, shared the latest observation date list for the current Bitcoin ETF race.

BlackRock submitted a spot ETF application in mid-June; the first deadline for the SEC’s response is September 2.

However, the resubmissions of the Ark and 21Shares Bitcoin ETF have passed the first deadline and are approaching the second deadline on August 13th.

The first deadlines for Bitwise, VanEck, Wisdomtree, Invesco, Fidelity, and Valkyrie are all in early September.

Bitcoin ETF competition. Source: Twitter/@JSeyff

The U.S. Securities and Exchange Commission (SEC) has not yet approved a physically-backed Bitcoin ETF, but analysts believe that BlackRock may be the first. Some speculate that the SEC is trying to control the crypto ecosystem through these Wall Street giants.

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