Robert Mitchinik from BlackRock suggests Bitcoin could become a low-beta investment as its recent performance shows decoupling from US equities. This comes amid investor shifts as BTC has remained stable while traditional assets have faced volatility. The ongoing institutional interest may support this change in perception of the cryptocurrency. Meanwhile, Jan van Eck hopes Bitcoin returns to being less correlated with market trends.
Bitcoin is on the radar of BlackRock’s Head of Digital Assets, Robert Mitchinik, who recently suggested it might transition into a permanent low-beta equity play. This statement resonates as Bitcoin (BTC) seems to be moving away from traditional U.S. equities in recent weeks, particularly during increased trade tensions between the U.S. and China. Some traders have started to view BTC as a more stable option amid these shifts in market sentiment.
During a panel at the Dubai Token2049 conference, Mitchinik stated, “It makes no fundamental sense, and yet when it’s repeated enough, it can actually become a little self-fulfilling.” His remarks point to a possible reflexive evolution of BTC’s market perception. He emphasised how frequent assertions by analysts and commentators could create a self-fulfilling prophecy regarding Bitcoin’s stability.
There’s been significant market movement; investors recently dumped U.S. assets, particularly hitting tech-heavy indexes like the Nasdaq and S&P 500 hard. In contrast, Bitcoin held its ground, showing less volatility compared to the S&P 500 over a seven-day period. This steady performance has supported the notion among crypto advocates that Bitcoin could truly serve as a safe haven asset away from geopolitical and monetary risks.
Mitchinik highlighted that renewed interest in U.S.-listed spot ETFs followed a wave of investor confidence, with approximately $3 billion pouring into these investment vehicles in just the last ten days. BlackRock’s own Bitcoin ETF, IBIT, has reportedly seen the highest inflows, indicative of growing institutional interest.
In this context, Mitchinik also mentioned that the shift in Bitcoin’s holding patterns, from less stable investors to those with a long-term view, is also ‘definitely happening.’ This change could further support Bitcoin’s status as a low-correlation asset.
On the topic of correlation, Jan van Eck, the CEO of VanEck, expressed at the same panel his desire to see Bitcoin revert to its earlier status as an uncorrelated asset, prior to 2020. The advent of ETFs and the broader institutional adoption of BTC since the Covid-19 crash has increased its correlation with traditional finance assets, especially with the Nasdaq, which has somewhat undermined its appeal as a hedging tool.
Van Eck also pointed out that traders might warm up to holding more Bitcoin if the correlations with traditional assets continue to weaken. In the end, a reversion to Bitcoin’s less interconnected legacy could reinvigorate its role in diversified portfolios.
