Let’s be honest.
Last month, I released a white paper that explained that conservative investors should award 10% to crypto, moderate clients should invest 25%, and aggressive investors should place 40% of their portfolios in crypto.
Bitcoin has surpassed any other asset class for 12 of the last 15 years, and it is very likely that it will continue to do so in the coming years. Institutions invest like never before. Congress and administration are now fully supporting crypto, and we are starting to gain the legislative clarity we have wanted.
SEC and Finra’s ban, which blocked brokerage companies from trade or custody of crypto, have been lifted. OCC and Fed have revoked similar ban on banks, and the Ministry of Labor has lifted its objection which prevented 401(k) Plans from offering Bitcoin as an investment option.
Despite the growth and benefit of Bitcoin, I still see suggestions that people should only award 1 or 2 percent to crypto. In my opinion, that’s no longer enough. Crypto is no longer speculative. It’s no longer niche. It now deserves to be treated as a core allocation.
Consider this hypothetical illustration, comparing a traditional 60/40 portfolio of stocks/bonds with portfolios that own 10 percent, 25 percent or 40 percent in Bitcoin. Let’s assume we invest $ 100 in five years and earn 7 percent annually in 60/40 allocation. Let’s also look at two extreme results: Bitcoin either becomes worthless or it rises in five years to $ 1 million (about a 10x increase from today).
As you look at the chart below, they rise $ 100 that were invested in the 60/40 portfolio to $ 140 after five years. Not bad. But the portfolio with a 25 percent bitcoin allocation could be worth more than 250 percent more. Although Bitcoin should become worthless (and you kept it all the way to zero)Your portfolio would still be profitable – with a value over your original investment. Seems me that the risk/rewarding relationship strongly favors a significant crypto allocation – and certainly one that is far higher than an unclear 1 or 2 percent.
Potential Interval of Portfolio Returns Based on Bitcoin — allocation
Bitcoin’s award assessment is not speculation – it’s just supply and demand. In the first quarter of 2025, public companies bought 95,000 Bitcoins – more than twice the new supply. And it is from only a category of buyers – it ignores further demand from retail investors, financial advisers, family offices, hedge funds, institutional investors and sovereign wealth funds. This massive imbalance between supply and demand is to run Bitcoin’s price to all time heights. I predict that Bitcoin reaches $ 500,000 by 2030 – a 5x increase from this writing.
The adoption curve has a huge space to run – supports the thesis that there is significant upside that does not yet come to Bitcoin’s price. Read the White Paper for more.
