Bitcoin and gold significantly enhance portfolio efficiency when adjusted for risk, compared to traditional strategies, according to analysts at Bitwise.
Over the past decade, a mixed 15% allocation between the leading cryptocurrency and the precious metal has shown a Sharpe ratio nearly three times higher than that of the benchmark 60/40 portfolio.
The Sharpe ratio is a measure that helps evaluate investment efficiency adjusted for risk. It indicates the additional return an investor receives per unit of volatility.
A high Sharpe ratio indicates effective capital management: the asset yields profit with moderate price fluctuations. Conversely, a low ratio suggests that potential gains do not justify the level of risk.
Bitwise explained that they effectively tested and confirmed the recommendation of billionaire and Bridgewater Associates founder Ray Dalio. In July, he recommended allocating 15% of an investment portfolio to bitcoin or gold as a hedge against the devaluation of the US dollar.
The calculated Sharpe ratio for a portfolio with 15% in these two assets was 0.679, compared to 0.237 for a traditional portfolio. A strategy with only gold showed a result of 0.436.
Performance During Crises and Growth
As part of the study, experts analyzed four major market downturns (2018, 2020, 2022, 2025), identifying a clear pattern in asset behavior.
During downturns, gold acts as a stabilizer, showing growth or smaller losses. Bitcoin, however, experiences deeper corrections than stocks. In recovery phases, the leading cryptocurrency significantly outpaces the precious metal and other traditional assets.
For instance, in 2020, amid the COVID-19 pandemic crisis, stocks fell by 33.79%, bitcoin by 38.10%, and gold by 3.63%. However, during the overall recovery, the flagship of the crypto market soared by 774.94%, the precious metal by 111.92%, and stocks by 77.8%.
Analysts also outlined the dynamics of the current rebound following the October crash. At the time of the study (data not final), gold led the way, rising by 44.79% from the local bottom. Stocks gained 38.65%, and bitcoin 14.04%.
The full recovery cycle will conclude in April 2026, so the final results may change.
“The question of choosing between gold and bitcoin is often posed as ‘either-or.’ However, as the data shows, historically the best answer is ‘both,’” concluded Bitwise.
Earlier, for the first time since mid-2022, the 52-week correlation between bitcoin and gold dropped to zero.