BlackRock Calls Bitcoin ‘Unique Diversifier’ in Research Paper

Less than a year after leading the way for spot Bitcoin ETFs, BlackRock, the world's largest investment firm with $9 trillion in assets under management (AUM), has published a Bitcoin "whitepaper" outlining the asset for potential investors.

The piece is titled "Bitcoin: A Unique Diversifier," and is co-written by Samara Cohen, BlackRock's ETF and Index Chief Investment Officer (CIO), BlackRock's Head of Digital Assets, Robert Mitchnick, and Russel Brownback, the Head of Global Macro Positioning for Fixed Income. The paper serves as BlackRock's "best attempt" to summarize the asset "in recognition of the early stage bitcoin is at in its journey."

BlackRock highlights Bitcoin's long-term performance and its low historical correlation to U.S. equities, except during periods of sudden shifts in U.S. dollar real interest rates or liquidity.

The publication emphasizes Bitcoin's unique properties such as decentralization, lack of traditional counterparty risk, and non-sovereign nature as primary drivers of the asset's separation from macroeconomic risks such as "banking system crises, sovereign debt crises, currency debasement, and geopolitical disruptions."

This reiterates Larry Fink and BlackRock's view of Bitcoin as a potential "flight to safety" asset, supported by BTC's 10-day and 60-day performance compared to gold and the S&P 500 during major geopolitical events, such as last year's U.S. banking crisis, the Iran conflict, and COVID.