A CoinDesk column by Lionsoul Global's Gregory Mall tested bitcoin allocations inside a traditional 60/40 portfolio and found that allocation size and holding method materially affected risk and return. The analysis showed direct bitcoin exposure boosted results in strong crypto periods but increased volatility and drawdowns, while a rules-based trend sleeve offered a more moderated profile.
A CoinDesk column by Lionsoul Global's Gregory Mall tested bitcoin allocations inside a traditional 60/40 portfolio and found that allocation size and holding method materially affected risk and return. The analysis showed direct bitcoin exposure boosted results in strong crypto periods but increased volatility and drawdowns, while a rules-based trend sleeve offered a more moderated profile.
A CoinDesk Crypto Long & Short column examined how bitcoin performed when added to a conventional 60/40 portfolio of global equities and core bonds. Gregory Mall, chief investment officer at Lionsoul Global, tested spot bitcoin allocations of 2.5% and 10% with monthly rebalancing from January 2021 through March 2026, then compared those results with a rules-based trend approach that switches between bitcoin and cash based on market signals.
A CoinDesk Crypto Long & Short column examined how bitcoin performed when added to a conventional 60/40 portfolio of global equities and core bonds. Gregory Mall, chief investment officer at Lionsoul Global, tested spot bitcoin allocations of 2.5% and 10% with monthly rebalancing from January 2021 through March 2026, then compared those results with a rules-based trend approach that switches between bitcoin and cash based on market signals.
The analysis matters because it shifts the portfolio question from whether bitcoin belongs in an allocation to how much exposure an investor can realistically hold through different market conditions. According to the column, adding bitcoin improved returns and Sharpe ratios in strong crypto years, but larger weights also raised volatility and produced deeper maximum drawdowns.
Mall's test found that a smaller bitcoin sleeve could alter portfolio outcomes while still preserving the basic character of a 60/40 portfolio. A larger allocation created a more pronounced trade-off, with more upside potential in favorable periods but a greater risk burden when bitcoin markets weakened.
The trend-managed version produced a different profile. By moving between bitcoin and cash, the rules-based sleeve moderated extreme outcomes, landing between the plain 60/40 portfolio and the direct spot bitcoin mix on risk and return. It improved drawdown behavior, though the column noted that this came at the cost of some upside.
The regime analysis separated markets into bull, bear and sideways periods using the 200-day moving average. Both bitcoin approaches outperformed the plain 60/40 portfolio in bull markets, while bear markets exposed the sharper downside of direct spot exposure. In sideways markets, where prices moved without a clear trend, direct bitcoin exposure struggled to justify the added volatility, while the trend sleeve had a better chance of avoiding unrewarded risk.
The column concluded that allocation decisions should account for both sizing and the holding rule behind the exposure. It also pointed to structural forces including post-ETF market flows, bitcoin's reduced supply growth after the 2024 halving and improving regulatory clarity as factors that could shape future outcomes, without claiming to predict the next cycle.
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