Source: Cryptoslate
Compiled by: Blockchain Knight
In a recent investment report, Allianz Group announced that Bitcoin is a 'reliable store of value,' marking the first time this $2.5 trillion asset management firm has recognized digital assets as legitimate institutional investment targets.
This report titled (Bitcoin and Cryptocurrency: The Future of Finance) starkly contrasts with Allianz's 2019 policy opposing Bitcoin investments.
Today, this German investment giant defines the process of Bitcoin 'evolving from an experimental protocol to a reliable store of value' as a core element of modern portfolio construction.
The report points out: 'Bitcoin's deflationary design, decentralized governance, and low correlation with traditional markets make it an attractive hedge and long-term asset.'
Allianz emphasizes that the correlation of Bitcoin with the S&P 500 index is only 0.12, and with gold is -0.04, which makes it an effective portfolio diversification tool.
Allianz lists 'accelerated institutional adoption' as a key factor in the legitimization of Bitcoin. The report mentions that as of the second quarter, corporate treasury purchases of Bitcoin have exceeded ETFs for three consecutive quarters, with public companies acquiring approximately 131,000 BTC in the second quarter alone.
The asset management firm also highlighted the newly launched cryptocurrency investment strategy of university endowment funds, specifically noting that Emory University is the first U.S. university to publicly disclose a large-scale Bitcoin investment.
Allianz believes this trend indicates that 'digital assets are integrating into the operations and investment strategies of higher education institutions.'
The report states that Federal Reserve Chairman Jerome Powell recently referred to Bitcoin as the 'digital equivalent of gold,' further confirming institutional recognition of Bitcoin.
Allianz also noted that the increase in global regulatory clarity has removed major barriers to institutional participation in the crypto space.
The report believes that the development of infrastructure has facilitated institutional entry. Regulated exchanges like Coinbase, institutional custodians like Fidelity Digital Assets, and SEC-approved Bitcoin spot ETFs together 'build a bridge between traditional finance and the crypto space.'
Allianz describes Bitcoin's transformation as 'one of the most profound changes in modern finance' and predicts it will continue to integrate into mainstream portfolios.
The firm expects that the tokenization of real-world assets and DeFi will 'significantly expand the total addressable market for cryptocurrencies.'
As one of Europe's largest asset management firms, Allianz's recognition carries significant weight. The company stated in a policy document released in 2019 that it would avoid cryptocurrency investments due to regulatory uncertainty and volatility concerns.
Allianz summarizes in the report: 'Unless an unforeseen disaster occurs, or a technological flaw leads to the collapse of the global financial system, Bitcoin will become a permanent component of the financial system, rather than a short-term speculative trend.'
The report further states that digital assets are 'not only a complement to the future of global finance but also its cornerstone.'
