The share of the first cryptocurrency in traditional investment portfolios should be 1-2%. This is stated in the report BlackRock Investment Institute.

Experts called this a "reasonable range" for a standard 60/40 portfolio with 60% stocks and 40% bonds. Such a distribution would put Bitcoin on par with the so-called Magnificent 7 companies, which include Alphabet, Amazon, Apple, Meta Platforms, Microsoft, NVIDIA and Tesla.

The average market capitalization of the latter is almost 35% of the market capitalization of the S&P 500 index ($46 trillion).

Note that, according to CoinMarketCap, Bitcoin's capitalization exceeds $2 trillion at the time of writing. Over the past 12 months, the price of the cryptocurrency has increased by more than 130%, compared to a 32% increase in the S&P 500 index, asForbes.

However, the share of the first cryptocurrency should not exceed 2% in the portfolio - this would lead to increased risks, the report says.

"We offer an allocation solution [for the portfolio] that strikes the right balance given the significant volatility of Bitcoin's price. This move will maximize its potential as a diversifier while minimizing its contribution to overall portfolio risk," said Samara Cohen, chief investment officer for ETFs and index products at BlackRock.

Experts at the world's largest company in terms of assets under management suggested further changes in attitudes towards the first cryptocurrency due to a number of factors. In particular — global fragmentation of the financial system, growing geopolitical tensions, lack of trust in banks and growing deficits.

"Bitcoin's value increases as its given supply meets increasing demand and demand changes due to investors' belief in Bitcoin's potential for broader use," the report says.

Experts emphasized that the widespread adoption of cryptocurrencies can promote their cross-border nature and decentralization.

The BlackRock report also noted the first cryptocurrency's historically low correlation with traditional markets.

According to Cohen, due to the events of the last two years, investors may have preferred cash and similar instruments in the portfolio that carry minimal risks. However, investors should rethink their strategy according to the new market conditions. In 2024, it is necessary to understand reinvestment risk, low interest rates and the need to shift to long-term asset allocation.

Although BlackRock recommends most investors allocate a maximum of 2% to Bitcoin in a portfolio, future gains may be more difficult due to changes in return characteristics, the firm noted.

Recall that the asset volume of the spot exchange-traded fund based on BlackRock's first cryptocurrency exceeded $50 billion.The company achieved this result in less than a year.