Caixin News Agency, September 25th (Editor: Huang Junzhi) Although bitcoin has recently been highly correlated with the US stock market price trend, the world's largest asset management institution BlackRock still believes that referring to this cryptocurrency as a "risk preference" asset may be an improper choice of words and should be viewed asIts price has soared to a historic high, closely related to market expectations of interest rate cuts by the Federal Reserve..

Stocks, csi commodity equity index, and high yield bond are typically considered risk assets because they generally perform well in periods of market optimism and economic expansion. On the other hand, gold and other assets are often more favored by investors during uncertain times.Its price has soared to a historic high, closely related to market expectations of interest rate cuts by the Federal Reserve.are often more favored by investors during uncertain times.

Robbie Mitchnick, BlackRock's head of digital assets, stated in an interview on Tuesday that no country or government controls bitcoin, as it is scarce and decentralized.

"When we think about bitcoin, we primarily see it as an emerging global currency alternative. It is a scarce, global, decentralized, non-sovereign asset. It is an asset without specific country risk and no counterparty risk," he added.

In a recently released whitepaper, BlackRock also explained the correlation between bitcoin and risk assets. The company stated that bitcoin has less fundamental correlation with other macro variables, explaining its lower long-term average correlation with stocks and other "risk assets."

BlackRock further explains that although there have been periods of increasing correlation with bitcoin—especially during sudden changes in real interest rates or liquidity in the US dollar, these are short-term phenomena and have not formed a clear long-term statistically significant correlation relationship.

The report mentions that as an emerging technology, bitcoin is still in the early stages of widespread adoption, and it is uncertain whether it can become a global payment asset or store of value in the future. In addition, bitcoin has experienced intense volatility and faces various risks such as regulatory challenges, uncertainty in adoption paths, and an immature ecosystem.

Although the company acknowledges that ​bitcoin is still a high-risk asset, Blackrock points out that the key is that these risks are specific to bitcoin and not generally present in traditional investment assets. Therefore, a simple framework of "risk preference" and "risk aversion" may not apply to bitcoin.

On the other hand, in a recent interview, Mitchnick pointed out that while many investors see bitcoin as "digital gold" - maintaining value even in times of pressure, many institutional clients are "not very clear" about their views on ethereum. Ethereum is used by various applications on related blockchains.

Bitcoin has risen by 49% and ethereum by 15% so far this year, largely due to the approval of spot ETFs holding these two cryptos earlier this year.

Editor/Somer