Larry Fink has changed his tune on Bitcoin.
It wasn’t long ago that the CEO of BlackRock—the world’s largest asset manager—turned his nose up at cryptocurrency.
Now, he calls himself a “major believer” in Bitcoin—and the latest moves by BlackRock prove it.
In January, for instance, the asset manager launched its own Bitcoin ETF—one of the most successful ETF launches in history. The fund already has more than $21 billion in assets under management.
And just last week, BlackRock released a report called “Bitcoin: A Unique Diversifer”—analyzing why Bitcoin is an essential component of every investment portfolio.
Let’s take a closer look at the report… and why it’s a game changer for the broader crypto market.
Proof of Bitcoin’s market hedge status
BlackRock’s report showcases Bitcoin’s remarkable journey:
- Since 2008, Bitcoin has achieved a staggering 807,000x return over 169 months.
- Despite experiencing significant pullbacks (up to 93% at times), Bitcoin has consistently rebounded to new highs.
- Bitcoin has shown a low correlation with U.S. equities, making it an excellent hedge against market pullbacks. In fact, its diversification benefits appear even better than traditional safe-haven assets like gold.
As further proof of Bitcoin’s status as a quality market hedge, take a look at its performance vs. the market and gold during times of serious geopolitical turmoil…
- During the U.S.-Iran escalation of 2020, Bitcoin returned 20%, while gold returned just 6%, and the S&P 500 lost 7%.
- During the COVID-19 pandemic of 2020, Bitcoin returned 21%, gold returned 3%, and the S&P 500 returned 2%.
- During the contentious 2020 U.S. presidential election season, Bitcoin returned 131%, while gold lost 1%, and the S&P 500 returned 14%.
What the report means for Bitcoin
BlackRock’s endorsement of Bitcoin is a game changer for the entire crypto market.
Put simply, the report isn’t just another market analysis—it’s a paradigm shift in how traditional finance views cryptocurrency.
By highlighting Bitcoin’s performance during times of crisis and its potential as an uncorrelated asset, BlackRock is effectively pushing for wider adoption among institutional and retail investors alike.
Coming from the world’s largest asset manager, this report provides unprecedented credibility to Bitcoin as an asset class. And it’ll likely set in motion a chain of events that will propel Bitcoin to new heights…
Other financial institutions will inevitably follow BlackRock’s lead, which will lead to a flood of institutional capital into the crypto market. And as more traditional finance players endorse Bitcoin, it will shift public perception of Bitcoin away from just a speculative asset class and into a mainstream investment… which will accelerate retail adoption.
It’s also worth noting that increased institutional involvement could lead to more stable and liquid crypto markets. That said, BlackRock’s report frames Bitcoin’s volatile price swings as opportunities for long-term investors to build their positions.
The bottom line
BlackRock’s report on Bitcoin marks a pivotal moment in the history of cryptocurrency. The strong endorsement from the world’s largest asset manager opens the door for Bitcoin to move from the fringes of finance… and become an integral part of any investment strategy.
Put simply, if you don’t have crypto exposure yet, now’s the time to get it.
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