Will BlackRock's Bitcoin ETF Take the Spirit Out of the Honey Badger?

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The “digital gold” story, the idea bitcoin can perform independently of monetary policy, is palatable to U.S. investors, michaeljcasey writes. But is easy categorization an attempt to control the biggest, most significant cryptocurrency? Opinion.

from Fidelity, Charles Schwab, Citadel and other financial heavyweights, that liberal, anything-goes framing will likely get less airtime.

But that’s going to be unsatisfying to financial advisors and their Main Street clients. While they’ve by now been well trained to think in terms of diversification and hedges against risk, there’s usually an underlying event-driven story behind it. For example: when a recession looms and projected earnings fall, the decline in value of your variable-income stock holdings will be balanced by exposure to fixed-income assets such as bonds.

On the other hand, with a long-term perspective, the bitcoin inflation hedge narrative holds up. With a 150x gain over the past decade, bitcoin has helped long-term holders offset the ongoing depletion in the dollar’s purchasing power more effectively than any other investment that was broadly available to them.

 

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