The Speaker, who calls himself a Bitcoin Maximalist, is often asked how much of the cryptocurrency one should own. So, he studied the impact of a 2 percent allocation to bitcoin in a S&P 500 portfolio. He realized that the average IRR would have increased by 3.7 percent annualized over the past five years and the Sharpe ratio would have also improved.

That is a simple recommendation to follow: convert a tiny percentage of your savings (2 percent) into bitcoin and dollar-cost average. Over time, as bitcoin increases in usage and gains more institutional acceptance the price should rise.

Source: Bloomberg

One of the participants suggested that if only a fraction of the global ultra-wealthy elite—275,130 people collectively holding assets worth $33 trillion—secure a small allocation to bitcoin, the total market cap could attain a trillion-dollar valuation from $175 billion today.

A couple of participants—one from a family office and the other from the city’s pension fund—were asked if they would allocate to bitcoin: both said no. “It is not even a consideration or serious talking point.” It was admitted, though, that bitcoin breaking above the $20,000 price level speedily would force a reevaluation to make sure they are not “missing something.”

Yale University’s $29 billion endowment has invested in at least two funds dedicated to cryptocurrencies. If their track record is anything to go by, it is only a matter of time before other institutions mimic their decision.

Everyone at the table owned bitcoin.


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