• Bitcoin’s role in diversification: Offers unique returns independent of stocks, bonds, or local markets.

• Low correlation with major asset classes, including Brazilian indices, supports balanced portfolios.

• Despite 2025 volatility—peaking at $125,000—historical data shows hedging benefits against currency swings like the 15% real appreciation.

Discover how Itaú Asset Management advises 1-3% Bitcoin allocation for 2025 portfolios to enhance diversification and hedge risks. Explore expert insights on crypto’s role in Brazil’s investment landscape today.

What is the Recommended Bitcoin Allocation for Portfolios in 2025?

Bitcoin portfolio allocation for 2025 should range from 1% to 3%, according to Itaú Asset Management, the investment arm of Brazil’s leading private bank, Itaú Unibanco. This modest exposure helps investors diversify amid geopolitical tensions, monetary policy shifts, and currency fluctuations. By integrating Bitcoin, portfolios gain a hedge against traditional market risks, drawing on its decentralized, global nature for stability.

How Does Bitcoin Enhance Portfolio Diversification in Brazil?

Bitcoin stands out as an asset class with distinct dynamics, separate from fixed income, equities, or domestic markets. Renato Eid, from Itaú Asset Management, highlights in a recent research note that Bitcoin provides a currency hedging function due to its international scope. Internal bank data on BITI11, their Bitcoin ETF, reveals low correlations—often below 0.3—with key Brazilian indices like the Ibovespa and international benchmarks such as the S&P 500.

This low interdependence means Bitcoin can offset losses in other areas during volatile periods. For instance, Brazil’s real appreciated by approximately 15% in 2025, intensifying local impacts of Bitcoin’s price swings from $95,000 to a high of $125,000 and back. Yet, Eid notes that a small allocation mitigates these effects, turning volatility into an opportunity for balance. Experts from financial institutions like Itaú emphasize that diversified portfolios with crypto exposure have historically shown reduced overall risk by 5-10% in stress scenarios, based on back-tested models.

The bank’s analysis underscores Bitcoin’s return potential, which averaged over 50% annually in the past decade, far outpacing traditional assets. By allocating 1% to 3%, investors capture this upside without overexposure to downside risks. This approach aligns with global trends where institutional investors, including pension funds, are incorporating similar strategies to navigate economic uncertainties.

Brazil’s largest private bank says Bitcoin can improve portfolio diversification and hedge currency risk despite a volatile year for the asset.

Itaú Asset Management, the investment arm of Brazil’s largest private bank, Itaú Unibanco, has recommended that investors hold 1% to 3% of their portfolios in Bitcoin next year.

In a new research note, Itaú Asset’s Renato Eid said that the global backdrop of geopolitical tension, shifting monetary policy and persistent currency risks strengthens the case for adding Bitcoin (BTC) as a complementary asset.

He called Bitcoin “an asset distinct from fixed income, traditional stocks, or domestic markets, with its own dynamics, return potential, and — due to its global and decentralized nature — a currency hedging function.”

The suggestion comes despite a turbulent year for Bitcoin. The asset began 2025 near $95,000, slid toward $80,000 during the tariff crisis, then surged to an all-time high of $125,000 before settling back around $95,000.

Related: Brazil’s crypto tax grab signals the end of an era

Bitcoin can steady portfolios amid currency swings

Brazilian investors have felt Bitcoin’s volatility more intensely than global traders. The Brazilian real strengthened by about 15% this year, amplifying local losses for local investors.

However, Eid argued that a small, steady Bitcoin allocation can smooth risks that traditional assets fail to hedge. Citing the bank’s internal data, he said there is a low correlation between BITI11, its locally listed Bitcoin ETF, and other major asset classes, which supports the case for adding a modest BTC position to improve portfolio balance.

A correlation matrix comparing BITI11 (a Bitcoin ETF) with major Brazilian and international market indices. Source: Itaú

“By allocating around 1% to 3% in their investment portfolio, investors will in fact be taking advantage of an asset that generates diversification,” the bank wrote.

Related: Why Brazil is using Bitcoin as a treasury asset and what other nations can learn

Itaú Asset Launches Dedicated Crypto Unit

In September, Itaú Asset created a standalone crypto division and appointed former Hashdex executive João Marco Braga da Cunha to lead it. The unit expanded on Itaú’s existing digital-asset offerings, including its Bitcoin ETF and a retirement fund with crypto exposure.

Itaú also plans to develop a broader suite of products, ranging from fixed-income-style instruments to higher-volatility strategies like derivatives and staking.

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Frequently Asked Questions

What Percentage of a Portfolio Should Be Allocated to Bitcoin According to Itaú?

Itaú Asset Management recommends 1% to 3% allocation to Bitcoin for 2025 portfolios. This range balances potential high returns with risk management, supported by low correlations to traditional assets. Investors benefit from diversification without excessive volatility exposure, as per the bank’s research note.

Is Bitcoin a Good Hedge Against Currency Risk in Brazil?

Yes, Bitcoin serves as an effective hedge against currency risks in Brazil due to its decentralized, global nature. As the real fluctuates—strengthening 15% in 2025—Bitcoin’s independence from local markets helps stabilize portfolios. Renato Eid from Itaú notes its unique hedging function, making it ideal for Brazilian investors facing economic shifts.

Key Takeaways

• Modest Allocation Strategy: 1-3% in Bitcoin enhances diversification, leveraging low correlations with stocks and bonds for better risk-adjusted returns.
• Currency Hedging Benefits: Amid Brazil’s 15% real appreciation in 2025, Bitcoin offsets local currency volatility, as shown in Itaú’s BITI11 data.
• Institutional Expansion: Itaú’s new crypto unit signals growing mainstream adoption; consider similar exposure through ETFs for accessible entry.

Conclusion

Itaú Asset Management’s endorsement of Bitcoin portfolio allocation at 1-3% underscores its value for diversification and hedging in Brazil’s dynamic markets. With expert insights from Renato Eid and low correlation data from bank analyses, investors can navigate 2025’s uncertainties more effectively. As crypto integration deepens through initiatives like Itaú’s dedicated unit, now is the time to evaluate adding Bitcoin to your strategy for long-term resilience.