Bitcoin's Role in Average Investor's Portfolio Remains Questionable, Says Analyst

According to CryptoPotato, despite Bitcoin's impressive performance this year, its role in an average investor's portfolio is still uncertain. Financial analyst and crypto advisory expert Aaron Brown expressed his concerns in an opinion piece published on Friday, stating that Bitcoin's unclear correlations to traditional asset classes make it an odd choice when purchased alongside stocks, currencies, or gold. Bitcoin has experienced a 160% increase since the beginning of the year, recovering from losses suffered last year alongside almost all other assets during historically aggressive interest rate hikes by the Federal Reserve. Brown noted that Bitcoin's volatility has been uncharacteristically low since March, even amid numerous industry scandals, hacks, and regulatory pressure. However, its unpredictable behavior around fundamental market events makes it a risky prospect for those who cannot or will not respond to regular price changes. On-chain data supports the skepticism of average investors. Glassnode analyst James Check reported earlier this week that there is very little market 'mania' among investors at $44,000 this year compared to nearly three years ago. Bloomberg blockchain analyst Jamie Coutts also suggested that Bitcoin's illiquid supply levels indicate a 'much higher base level of conviction' among investors. Despite these concerns, Bitcoin is making progress on the regulatory front, with traditional and regulated financial services like options, lending, and custody now available for the asset. Issues around tax treatment and legality appear mostly resolved, and approval of a Bitcoin spot ETF seems all but certain by next month. Brown concluded that even traditional investors should consider a small allocation to Bitcoin, as the potential upside outweighs the risk of having no exposure at all.