A potential resurgence for Bitcoin appears to be unfolding, particularly in light of recent global events. As the cryptocurrency market experienced its latest gains, ProShares’ global investment strategist, Simeon Hyman, discussed the bullish trend for Bitcoin during an appearance on CNBC’s “ETF Edge.” He noted that Bitcoin has shown resilience, stating, “If you look at bitcoin, it’s up a little bit and equities are down since the Iran war began.” According to Hyman, this trend highlights Bitcoin’s role in portfolio diversification amid geopolitical uncertainty.
As of the last market close, Bitcoin recorded a 5% increase over the week, with the majority of this rise occurring within a single 24-hour period. Since the onset of the conflict in Iran on February 28, Bitcoin has surged approximately 8%. In contrast, the S&P 500 and gold have each declined over 3% during the same timeframe, while the tech-focused Nasdaq has fallen more than 2%.
ProShares, a key player in the cryptocurrency investment space, currently manages over a dozen cryptocurrency exchange-traded funds (ETFs). Recently, it launched the ProShares CoinDesk 20 Crypto ETF (KRYP), which has also seen a nearly 5% gain since the beginning of the Iranian conflict, although it remains down about 7% since its debut in early February. Despite Bitcoin’s recent uptick, it still lingers more than 40% below its all-time high of $126,198 reached in October.
Commenting on the market climate, Kim Arthur, founding partner and CEO of Main Management, suggested that Bitcoin may be navigating through a classic “crypto winter,” a phenomenon characterized by sharp fluctuations that typically recurs every four years. Arthur described the current phase as a bottoming stage. He remarked, “Bitcoin was trading at $125,000 five months ago, so it was down over 50% when this conflict erupted.” He acknowledged Bitcoin’s recent outperformance compared to other asset classes, while urging investors to maintain a broader perspective on its volatility.
As a portfolio manager, Arthur mentioned he is currently adopting a passive investment strategy regarding Bitcoin. He regards Bitcoin as his benchmark and compares all other assets against it, stating that it has proven to be a challenging asset to outperform, particularly since 2021. Overall, the digital currency has gained roughly 15% over the past five years, indicating its complex and often unpredictable nature within the financial landscape.
