Bitcoin Rallies After BlackRock Highlights Its Potential As A Hedge

According to Cointelegraph, Bitcoin surged nearly 6% following the release of a white paper by BlackRock, the world’s largest asset manager, which emphasized the digital asset’s potential as a hedge against monetary and geopolitical risks. BlackRock's report, titled 'Bitcoin: A Unique Diversifier,' was shared by senior Bloomberg ETF analyst Eric Balchunas on September 18. The white paper describes Bitcoin as a 'unique diversifier' that is detached from traditional fiscal and geopolitical risks. The report was shared at 4:21 pm UTC, shortly after Bitcoin began its rally from a daily low of $59,354. Since then, Bitcoin has climbed over 5.7%, briefly reaching $62,600 for the first time in over three weeks. Some analysts predict that Bitcoin could see a three-month rally up to $92,000 starting in October, based on historical chart patterns and Bitcoin’s average monthly returns for the fourth quarter. BlackRock’s white paper highlights Bitcoin’s decentralized and permissionless nature, describing it as the world’s first 'truly open-access monetary system.' The asset manager also noted that Bitcoin has 'no traditional counterparty risk' and is largely detached from critical macro risk factors such as banking system crises, sovereign debt crises, currency debasement, geopolitical disruption, and other country-specific political and economic risks. The white paper includes a chart demonstrating how Bitcoin returns have outperformed the S&P 500 and gold prices during major geopolitical events. BlackRock believes that Bitcoin’s adoption will be driven by global monetary and geopolitical concerns. The report states, 'Over the long term, Bitcoin’s adoption trajectory is likely to be driven by the degree to which concerns rise and fall over global monetary instability, geopolitical disharmony, US fiscal sustainability, and US political stability.' BlackRock is the issuer of the world’s largest Bitcoin exchange-traded funds (ETF), holding over $21.4 billion worth of BTC and commanding over 38% of the Bitcoin ETF market, according to Dune data.