As the Trump administration escalates trade war pressures against China, causing global market fluctuations, Bitcoin (BTC) has recently shown stable performance, not experiencing significant volatility like risk assets such as US stocks. This phenomenon has drawn widespread attention from institutional investors and the crypto community, who believe that Bitcoin is exhibiting characteristics of a 'low Beta asset.'
Bitcoin becomes a low Beta asset
At the Token2049 summit held this week in Dubai, BlackRock's head of digital assets, Robert Mitchnick, stated that although the positioning of this 'low volatility safe-haven asset' is still controversial in terms of fundamentals, it might become a self-fulfilling expectation due to market repetition. Robert Mitchnick said:
"There isn't much theoretical basis for this fundamentally, but if this assertion is repeated enough times, it could really become a self-fulfilling expectation. Because with enough commentators, research institutions, and media stating that it is a low Beta asset, it might ultimately perform as such."
Recent tensions in US-China relations have led to market concerns about an economic recession, resulting in poor performance of US stocks. However, Bitcoin has performed relatively well, even showing lower seven-day volatility than the S&P 500, briefly indicating signs of 'decoupling.' Mitchnick believes this further validates BTC's characteristic of being unaffected by the economic, monetary, or political risks of any single country.
This phenomenon has also quickly reflected in fund flows. According to data from Farside Investors, over the past ten trading days, the US spot Bitcoin ETF has seen a net inflow of over $3 billion, 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-oriented holders.
VanEck: Bitcoin should return to the positioning of a 'non-correlated asset'
The CEO of VanEck, Jan van Eck, who also attended the event, expressed his hope that Bitcoin could return to its pre-2020 state, becoming an asset with no significant correlation to traditional financial markets. He pointed out that since the pandemic, Bitcoin has attracted institutional attention, and after the launch of ETFs, Bitcoin has begun to show stronger correlations with risk assets like the Nasdaq, undermining its role as a safe haven for asset allocation.
"If Bitcoin's correlation with traditional assets further decreases, more investors will be willing to include it in their portfolios."
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