BlackRock: "A 50%+ drop in BTC does not change its long-term investment attractiveness"

BlackRock released a report titled “Re-Underwriting Bitcoin,” recommending holding 1-2% of your portfolio in BTC for long-term diversification.

Key takeaways:

• The Bitcoin crash, which saw prices drop by more than 50% from the October 2025 high, was primarily driven by deleveraging, weakening capital inflows, and a slowdown in purchases by corporate crypto treasuries—rather than a deterioration in the asset’s long-term prospects.
• BlackRock’s calculations over the past 10 years show that allocating 1-2% of a traditional stock-and-bond portfolio to Bitcoin would have improved the risk-return ratio.
• BlackRock views Bitcoin as an alternative monetary asset that could become increasingly sought after amid rising U.S. government debt and budget deficits.
• From January 2024 to September 2025, spot BTC products attracted approximately $60 billion in inflows. From October 2025 to July 2026, about $5 billion was withdrawn from these products, while AI funds attracted $46 billion during the same period.
• Open interest in crypto futures at one point exceeded $90 billion, with roughly 80% coming from perpetual contracts outside CME. Subsequent rate shocks triggered waves of liquidations, pushing Bitcoin below $60,000 in June 2026.
• The BTC market is maturing: BlackRock notes a gradual decline in the asset’s volatility as spot ETFs, futures, and options continue to develop, though high-leverage trading remains a source of sharp price movements.