Bitcoin ETFs’ 100% Rally Raises More Questions Than Answers

Group 1 - Bitcoin ETFs have surged approximately 100% since January 2024, matching the returns of physical gold ETFs, while the S&P 500 has returned only 45% [2] - This performance has ignited a debate regarding Bitcoin's classification as either a "risk-on" asset like stocks or a "store of value" akin to gold [2][3] - Despite Bitcoin's reputation as a volatile asset, its ETF performance has aligned with historically stable investment vehicles, prompting investors to reconsider the risk-reward balance [3] Group 2 - The volatility of cryptocurrencies remains a concern, with risk-adjusted returns being a critical factor in assessing their role in diversified portfolios [4] - BlackRock's People & Money report indicates a growing retail interest in ETFs, particularly among younger investors, with 19 million US adults likely to purchase ETFs in the next year [4] - Among these new investors, 47% are expected to invest in crypto ETFs, highlighting a significant shift towards equity and crypto allocations [4]