BlackRock Recommends 2% Bitcoin Allocation for Portfolios

In a groundbreaking move, BlackRock has proposed that investors allocate 1-2% of their multi-asset portfolios to Bitcoin (BTC), marking the first time the asset management giant has offered specific guidance on cryptocurrency investment. The recommendation likens Bitcoin to Wall Street’s elite “Magnificent 7” stocks, solidifying its position as a core asset in modern portfolios.

BlackRock’s Bitcoin Allocation Strategy

The $11.5 trillion asset manager outlined its recommendation in a newly published report, describing a 1-2% Bitcoin allocation as a “reasonable range” for diversified portfolios. This guidance comes as spot Bitcoin exchange-traded funds (ETFs) have amassed an impressive $113 billion in assets under management (AUM).

BlackRock’s ideal portfolio framework continues to follow the traditional 60-40 split between stocks and bonds, with Bitcoin providing an additional edge. The suggested stock segment includes the Magnificent 7—Alphabet (Google), Amazon, Apple, Meta Platforms, Microsoft, Nvidia, and Tesla—while maintaining the same risk weight as a 2% Bitcoin allocation.

The report warns against larger allocations, noting that exceeding the 2% range would significantly increase overall portfolio risk.

Dominance in the Spot Bitcoin ETF Market

BlackRock’s spot Bitcoin ETF, iShares Bitcoin Trust (IBIT), leads the market with $53.8 billion in investments, accounting for roughly half of all BTC held by ETFs. Currently, spot Bitcoin funds hold over 1.104 million BTC, surpassing the holdings of Bitcoin creator Satoshi Nakamoto.

Notably, these ETFs custody approximately 529,000 BTC under Coinbase Custody, highlighting the growing institutional embrace of Bitcoin as a mainstream asset.

Regulatory Optimism and Institutional Adoption

The report’s timing coincides with heightened optimism for crypto-friendly regulations, particularly under the anticipated pro-crypto administration of U.S. President-elect Donald Trump. Banks like Goldman Sachs, already holding nearly $1 billion in BTC ETF shares, have signaled plans to expand participation based on favorable regulatory shifts.

Additionally, states such as Alabama and Pennsylvania are exploring legislation to establish strategic Bitcoin reserves. Similar initiatives are under consideration in countries like Brazil, Canada, and the U.S., showcasing the growing recognition of Bitcoin’s strategic importance in national and institutional portfolios.

A Milestone for Bitcoin

BlackRock’s recommendation signifies a pivotal moment for Bitcoin, elevating it to a core investment status akin to traditional blue-chip assets. As spot BTC ETFs continue to draw significant institutional interest, Bitcoin’s role in reshaping portfolio strategies and global financial landscapes becomes.

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