Bloomberg analysts suggest Bitcoin may be suitable for public companies due to its resilience and declining correlation with stock markets. Amid rising macroeconomic uncertainty, Bitcoin’s volatility is lower than major indices, indicating its potential as a low-risk asset. Public companies reportedly hold over 711,000 BTC, with Strategy leading Bitcoin holdings significantly.
Bloomberg Intelligence strategists Lu Yeung and Breanne Dougherty suggest that Bitcoin may become a viable asset for public companies, primarily due to its proven resilience. While Bitcoin traditionally correlates with the U.S. stock market, this relationship appears to be weakening following events referred to as “Liberation Day.”
Surprisingly, Bitcoin has shown strong performance amidst tariff-driven market volatility, igniting discussions about its potential decoupling from equities. Its 10-day volatility has also been notably lower than that of major stock indices.
The analysts propose that corporate managers might reconsider the cryptocurrency’s viability as a hedge against the U.S. dollar, particularly given the increasing macroeconomic uncertainty. David Lawant, research head at FalconX, notes that although Bitcoin’s correlation with stocks persists, it has transitioned to a low beta asset, predominantly reducing risk rather than amplifying it.
Recent data from cryptocurrency index fund manager Bitwise indicates that public companies collectively hold nearly 700,000 Bitcoins as of Q1 2023, with an increase in participation from 12 additional companies last quarter. As it currently stands, they hold approximately 711,000 BTC.
Among these companies, Strategy has emerged as the largest Bitcoin holder, maintaining a substantial lead with total purchases amounting to $35.6 billion. Recently, they announced an additional investment of $556 million in Bitcoin.
