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Bitcoin Becomes a Low Beta Asset
VanEck: Bitcoin Should Return to the Status of “Non-correlated Asset”
At the Token2049 summit held this week in Dubai, Robert Mitchnick, head of digital assets at BlackRock, stated that although the positioning of Bitcoin as a “low-volatility hedge asset” is currently contentious on a fundamental level, it may become a self-fulfilling expectation due to repeated market narratives. Robert Mitchnick said:
“There isn’t much theoretical basis for this fundamentally, but if this claim is repeated enough times, it might really become a self-fulfilling expectation. Because there are enough commentators, research institutions, and media stating that it is a low beta asset, it might ultimately perform that way.”
Recent tensions in U.S.-China relations have led to market concerns about an economic recession, resulting in poor performance of U.S. stocks. However, Bitcoin has shown relative resilience, even exhibiting a seven-day volatility lower than that of the S&P 500, briefly showing signs of “decoupling.” Mitchnick believes this further validates Bitcoin’s characteristic of being unaffected by the economic, monetary, or political risks of a single country.
This phenomenon is also quickly reflected in the flow of funds. According to data from Farside Investors, over the past ten trading days, there has been a net inflow exceeding $3 billion into U.S. spot Bitcoin ETFs, with BlackRock’s IBIT ETF attracting the most capital. Mitchnick believes this indicates that funds are shifting from short-term speculators to longer-term, fundamentally-driven holders.
VanEck: Bitcoin Should Return to the Status of “Non-correlated Asset”
Jan van Eck, CEO of asset management firm VanEck, who also attended the event, expressed his hope for Bitcoin to return to its pre-2020 state, becoming an asset with no significant correlation to traditional financial markets. He noted that since the pandemic, Bitcoin has gained institutional attention, and following the launch of ETFs, Bitcoin has begun to show stronger correlations with risk assets such as the Nasdaq, diminishing its role as a safe haven in asset allocation.
“If the correlation between Bitcoin and traditional assets continues to decrease, more investors will be willing to include it in their portfolios.”
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