Bitcoin
Bitcoin and broader crypto assets have delivered higher volatility without a corresponding long-term return advantage over the Nasdaq-100, according to Bloomberg Intelligence senior commodities strategist Mike McGlone.
In a post on X, McGlone argued that the performance of Bitcoin and other digital assets should be reassessed from a portfolio and risk-management perspective. His assessment focuses on the MarketVector Digital Assets 100 Index (MVDA), which has a roughly 67% weighting in Bitcoin.
According to McGlone, the MVDA has lagged the Nasdaq-100 Index since 2017, the year Bitcoin futures began trading through CBOE and CME. He also highlighted a significant difference in volatility, arguing that the MVDA has been approximately three times more volatile than the Nasdaq-100 over that period.
The combination is central to McGlone’s criticism. In his assessment, the substantially higher volatility of digital assets has not translated into a meaningful additional long-term return compared with the Nasdaq-100. From a risk-adjusted portfolio perspective, he therefore characterizes Bitcoin as a failing asset rather than an effective source of additional portfolio efficiency.
McGlone also examined the relationship between crypto assets and equities. While higher volatility could theoretically contribute to diversification if an asset maintains a negative correlation with stocks, he argued that the positive correlation between digital assets and equities limits that potential benefit. This reduces Bitcoin’s usefulness as a risk-management instrument independent of traditional assets, according to his analysis.
The performance comparison also carries a longer-term implication for the crypto market. McGlone argues that the MVDA’s relative advantage over the Nasdaq-100 ended after the 2017 period, meaning the higher risk associated with digital assets has not been accompanied by sustained outperformance in the comparison he highlighted.
His assessment also incorporates the market’s changing expectations around major crypto catalysts. McGlone argued that developments including the approval of spot Bitcoin ETFs and the pro-crypto policy stance of the Donald Trump administration have already been largely priced into digital assets.
If that assessment holds, the market would face a higher bar for future crypto outperformance. The key issue is no longer simply whether Bitcoin can generate strong returns, but whether those returns can justify the additional volatility and risk relative to traditional assets. For investors evaluating Bitcoin through a portfolio-management lens, the relationship between risk, correlation and incremental return remains the central issue in McGlone’s argument.
