Bitcoin and Ethereum are a profitable investors’ best asymmetric upside option in a dual economy. Recent drawdowns and regulatory uncertainties aside, both cryptocurrencies are still displaying strong fundamentals. These unique qualities help these picturesque landmarks transcend to valuable assets for any portfolio. Given the state of the macroeconomic landscape, strategic allocations to BTC and ETH now have the potential to deliver outsized returns.
Bitcoin's Resilience and Scarcity
Bitcoin’s pivotal support point at $93,000, the expected June 2025 bottom, needs to hold in order for the asset to stay on its bullish path. Bitcoin feels the pain with a 27% drawdown from 2025 high. Notwithstanding this, its supply dynamics indicate to us that it is far from immune, still pricing in potential recession risks, while acting as a convexity play. That resilience is evident during the ongoing 2022-2023 “crypto winter.” Bitcoin was racking up gains of 82%, shooting up from $60,000-$110 in this time period, while the S&P 500 index only achieved a 20% return.
Bitcoin’s greatest strength comes from its scarcity, limited to just 21 million coins. Furthermore, it functions as a liquidity-driven store of value further increasing its attractiveness. This scarcity, along with its decentralized nature makes Bitcoin a powerful hedge against reckless monetary experiments and inflation. The University of Michigan survey, which indicates inflation expectations near multi-decade highs at 4.9% in the short term, further underscores the importance of such hedges.
Bitcoin truly shines against legacy assets in times of crisis. As a monetary policy it has drawn in a wide array of investors searching for safe haven for their wealth and opportunistic future growth.
Ethereum's Utility and Regulatory Landscape
Ethereum is up 60% in 2025, but it has significantly underperformed Bitcoin, mostly due to a cloud of regulatory uncertainty. This persistent underperformance further spotlights Ethereum’s correlation with risk sentiment, with regulatory fears traditionally suppressing investor excitement.
Even with these setbacks Ethereum’s fundamentals are underpinned with growing utility which we believe makes it attractive utility token, particularly in a stagflationary environment. Its ambitious use cases combined with its impressive technological stack lay a solid long-term foundation.
Strategic Portfolio Allocation
We have a new economic reality, one that has exposed a deeply divided economy. Services PMI, which averaged 53.2%, nearly all the way as Manufacturing PMI trails with a 48.5%. In this kind of environment, a boundlessly strategic allocation to both Bitcoin and Ethereum can be incredibly lucrative.
Investors should have 3–5% of their portfolio in BTC and ETH. This will ensure they’re able to reap the maximum upside potential these assets have to offer. Bitcoin as a hedge against inflation and deteriorating economy. At the same time, Ethereum provides access to the ever-growing benefits of blockchain technology.
