What is the price of Bitcoin? BlackRock Exec Explains

Bitcoin is worth the same as “an uncorrelated asset that benefits when the world gets messier,” Jay Jacobs is BlackRock’s US Director of Equity ETFs. He spoke to CNBC on Thursday.

“Crypto over the long run is decoupled from US tech stocks,” Jacobs saidStressing the fact that market volatility can obscure differences, but not that “the long-term correlation between US stocks and Bitcoin is more like two or three percent.” He argued that what pushes equities higher—”higher growth, higher certainty, lower geopolitical risk”—is the mirror image of the forces that move Bitcoin. “Bitcoin thrives when you have more uncertainty and are looking for something that’s going to behave differently, so fundamentally they should behave like an uncorrelated asset.”

BTC changed hands for just over $94,000 at Jacobs’s appearance. This extended a rally which has gained roughly 150% in the past year since approval of spot-ETFs.

Bitcoin Rises Because Of ‘Mega-Forces”

Jacobs correlated price behavior directly with flows. “We would think over the long term, if this trajectory of greater uncertainty around the world continues, things like gold and Bitcoin should continue to go up.” Investors are shifting their positions accordingly, he said. “We’ve seen significant inflows into gold ETFs; we’ve seen significant inflows into Bitcoin, and this is all because people are looking for those assets that will behave differently.”

Related Reading

The biggest beneficiary has been BlackRock’s own iShares Bitcoin Trust (IBIT), which on 23 April absorbed $643 million of net creations—its largest one-day haul since January—lifting the fund’s assets About $54 billion.

Jacobs described the rush to hard assets as a part of a larger geopolitical realignment. “If you look at central banks around the world, a continued movement towards diversification beyond just holding dollars is something that’s been happening for decades… the switch from just holding dollars to holding gold to looking at other types of assets like Bitcoin is a trend that’s been years in the making.”

Central-bank gold purchases In 2024 the net purchase of grain was 1,044 tons, the highest level in three years, and double what it had been during the past decade.

BlackRock 2023 is the target for those moves. “mega-forces” The framework identified fragmentation of geopolitical space as the secular force driving returns. “That mega force is materialising in policies like reshoring in the United States and, I think, directly related to that fragmentation has been the rise of things like Bitcoin, as people see more destabilisation in geopolitics resulting in the need for more alternative assets.”

Related Reading

BlackRock is a powerful company. The firm’s management of $11.6 trillion, a new record for the quarter ended in the first.

Asset managers codify uncertainty by combining this scale with the public thesis that Bitcoins’ fair price increases as it becomes more uncertain. valuation model in which scarcity and sanction-resistance—not discounted cash flows—set the marginal price.

Jacobs said that the market was a “secular” phenomenon. “looking for alternatives—parts of the portfolio that are going to behave separately from stocks and bonds.” The world’s biggest asset manager may have the best blueprint to date for pricing cryptocurrency, as IBIT is now consuming more BTC per day than the miners are able to produce after the halving.

BTC is currently trading for $94,510.

Featured image was created with DALL.E chart by TradingView.com