- 5% is the new 1% for portfolio allocations, said Matt Hougan of Bitwise.
- Institutional investors hold up to 2.5% in cryptocurrencies.
- Corporations are increasingly adding Bitcoin to their balance sheets.
The days of minimal exposure to Bitcoin are over.
That’s the message coming from a swathe of institutional players who are now rethinking how much crypto they should fit into their portfolios.
“The level of interest in crypto is very high,” said Matt Hougan, CIO at crypto ETF provider Bitwise. “Inflows will be measured in the many billions.”
Indeed, Hougan laid out how much — on a percentage basis — will go towards crypto.
“5% is the new 1% for portfolio allocations,” he said.
Institutions pile in
Data by research firm CoinShares supports that view.
According to the firm’s Digital Asset Fund Manager survey from April, average digital asset weightings have risen to 1.8%, the highest in a year — with institutional portfolios averaging 2.5%.
When the year began, allocations had dropped to 0.7% from 1%, pushed down by “cautious” institutional investors.
Saylor’s playbook
The uptick in allocations comes as institutions scramble to follow Michael Saylor’s playbook for his firm Strategy.
This means treating Bitcoin not as a speculative bet but as a long-term asset on corporate balance sheets.
Strategy, once a software company, has turned itself into the world’s largest corporate holder of Bitcoin, with $58 billion of the asset in its reserves.
Its ballooning Bitcoin holdings and soaring stock price has triggered a number of copycats to follow in its footsteps.
Institutions are also taking notice of Bitcoin’s price behavior — it has at times “decoupled” from high-risk tech equities — while sentiment is improving as the asset creeps back up near its all-time high of $108,000.
Bitcoin trades at $103,554.
The road to $1 million
Jay Jacobs, US head of equity ETF for BlackRock, the world’s largest asset manager with $12 trillion, said that because of the macroeconomic uncertainty, investors are increasingly looking at Bitcoin in lieu of traditional assets like stocks and bonds.
Crypto influencer Arthur Hayes echoed that view.
In his latest blog post, Hayes argued that a combination of Trump’s economic policies, and global instability will drive investors away from US Treasuries and into Bitcoin.
“Foreign capital repatriation and the devaluation of the gargantuan stock of US treasuries will be the two catalysts that will power Bitcoin to $1 million sometime between now and 2028,” he said.
Pedro Solimano is a markets correspondent based in Buenos Aires. Got a tip? Email him at psolimano@dlnews.com.