ARK Invest Makes the Case for Bitcoin in Institutional Portfolios
In their latest annual research report titled ‘Big Ideas 2024,’ ARK Invest recommends a significant allocation of 19.4% to Bitcoin in institutional portfolios. This recommendation is based on an extensive analysis of Bitcoin’s historical performance compared to traditional investment assets. Over the past seven years, Bitcoin has demonstrated an annualized return of 44%, outperforming other major assets that averaged only 5.7%. ARK Invest’s report highlights the importance of a long-term perspective when investing in Bitcoin, as investors who held the cryptocurrency for at least five years have consistently profited regardless of the purchase timing.
The Potential Impact of Institutional Investments in BTC
ARK Invest’s report also explores the potential impact of institutional investments in Bitcoin globally. If just 1% of the $250 trillion worth of global investable assets were allocated to BTC, its price could reach $120,000. Furthermore, if institutions were to align with ARK’s suggested allocation of 19.4%, the valuation of BTC could reach approximately $2.3 million per BTC. This represents a significant shift from previous years, as the recommended optimal Bitcoin allocation has increased over time.
Bitcoin’s Current State: Signs of Recovery Amid Market Volatility
Although BTC’s current value is lower than these hypothetical figures, it has shown signs of recovery recently. In the past week, Bitcoin’s price has increased by 6.1% following a significant plunge. This recovery aligns with Glassnode’s data, which indicates a rise in stablecoin supply and their purchasing power to acquire BTC. The declining stablecoin supply ratio (SSR) oscillator further supports this trend, suggesting a favorable market condition for Bitcoin acquisition.
Hot Take: Bitcoin Continues to Gain Momentum in Institutional Portfolios
ARK Invest’s research report provides a compelling case for including Bitcoin in institutional portfolios. With its impressive historical performance and the potential impact of institutional investments, Bitcoin continues to gain momentum as a valuable investment asset. As more institutions recognize the long-term benefits of holding Bitcoin, its value and adoption are likely to increase. Investors should consider Bitcoin’s potential for growth and its ability to deliver profits over time, rather than focusing on short-term volatility. Overall, Bitcoin remains an attractive option for institutional investors seeking diversification and higher returns.
By
By
By
By