BlackRock Bonkers for Bitcoin




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Published on

Sep 26, 2023

Original Article Date: 08/06/2023

We all know that several large asset managers have applied for a spot Bitcoin ETF (exchange-traded fund). As a reminder, here is a list of a few notable applicants:

1. Blackrock

2. ARK Invest

3. WisdomTree

4. Invesco

5. Valkyrie

6. Fidelity

In April 2022, analysts from BlackRock conducted a study on Bitcoins performance from 2010 to December 2021. The goal of the study was to determine the optimal portfolio allocation when adding Bitcoin. BlackRock’s results reveal that for a 60-40 portfolio (60% equities and 40% bonds) the recommended optimal allocation to BTC is a remarkable 84.9%. The remaining 15.1% is advised to be divided equally between equities and bonds, maintaining a 60-40 ratio. With BlackRock being the largest wealth manager in the world, this type of news is incredibly positive for Bitcoin and its potential adoption into long term wealth management strategies globally.

In the event that all of the Bitcoin ETF applications were approved, the price of Bitcoin would inevitably rise. Here are some examples of potential price targets given future market cap increase and institutional allocation.

Currently, BTC has a market cap of approximately $566B with a value of ~$29,150.

If BTC had the market cap of Apple Stock (AAPL): Current BTC MC $566B Current AAPL MC $3T Value of one (1) BTC with $3T MC = $154,700 (5.31X)

If BTC had the market cap of Gold: Current BTC MC $566B Current Gold MC $13T Value of one (1) BTC with $13T MC = $667,449 (21.91X)