After Bitcoin fell by about 50% from its peak in October 2025, foreign media reported that BlackRock re-examined its institutional allocation strategy for Bitcoin. The article cited a 10-year backtest, which indicated that adding a small amount of Bitcoin to a traditional 60/40 stock-bond portfolio still resulted in improved risk-adjusted returns historically.
The configuration range of 1% to 2% appears again.
Belleard's calculations show that as of May 29, 2026, the traditional 60/40 portfolio had an annualized return of about 9.9% and an annualized volatility of about 10.1%. If 1% Bitcoin is added, the annualized return rises to about 10.9%, with volatility slightly increasing to about 10.3%; if 2% Bitcoin is allocated, the annualized return is about 11.8%, and the volatility is about 10.6%.
According to this metric, a 2% allocation to Bitcoin provides an additional annualized return of about 190 basis points compared to traditional portfolios, while the volatility only increases by about 50 basis points. The article states that the Sharpe ratio of the portfolio has risen from 0.81 to 0.96, and the maximum drawdown has changed from -20.3% to -20.9%. These figures are based on historical backtesting and do not represent future returns, but they are used to illustrate that considering Bitcoin's volatility alone may not be sufficient to assess its role within a portfolio.
BlackRock is not making this range for the first time. The article states that in previous studies, from the perspective of risk contribution, it was believed that a range of 1% to 2% might be relatively reasonable for investors who can afford to take on the associated risks; if it exceeds 2%, the impact of Bitcoin on the overall portfolio risk would be more significant.
IBIT Expansion to Strengthen Institutional Discussions
The article also mentions that BlackRock's spot Bitcoin product IBIT has become one of the largest and most actively traded Bitcoin ETP products in the world, and is set to become BlackRock's highest-income ETF product by 2025.
According to the data cited in the text, the US spot Bitcoin ETF holds a total of about 1.25 million BTC, which is nearly 6% of the fixed supply of 21 million Bitcoins. Among them, IBIT alone holds about 775,000 BTC, accounting for more than 60% of the total holdings of US spot Bitcoin ETF.
The article argues that this indicates that BlackRock's research is not detached from a commercial context, as IBIT itself is already an important product of theirs. On the other hand, it also shows that BlackRock is continuing to reinforce discussions about the value of Bitcoin allocation after observing real-world capital allocation behaviors, rather than remaining at just a theoretical level.
The drawdown phase is a better test of investment assumptions.
The article mentions that the timing of this research release is also worth noting. BlackRock did not reiterate its investment strategy when Bitcoin reached a record high, but rather reassessed its position after a significant pullback. The firm concluded that the previous decline was more due to the liquidation of leveraged positions, a slowdown in capital flows related to ETP, and a weakening demand from corporations to buy Bitcoin, rather than any fundamental change in the investment logic for Bitcoin.
The article argues that institutional discussions are shifting from "whether to hold Bitcoin" to "how much to allocate, how much risk to take, and how to view relevance and liquidity." For corporate financial officers and boards of directors, the focus is no longer just on the volatility of Bitcoin, but rather on whether a small proportion of allocation can improve the efficiency of the overall asset-liability portfolio.
Additional information:The original text is an opinion article, with its core basis being BlackRock's historical backtesting and the holding data of ETF. The conclusions are mainly used to illustrate changes in institutional allocation discussions and do not serve as a guarantee for future returns.
