Recently, I came across an interesting analysis report published by Cathie Wood’s Ark Invest, outlining four major trends that are changing Bitcoin’s market position. Simply put, Bitcoin is gradually evolving from a fringe asset into a standard holding in institutional investment portfolios.

Let’s start with the macro backdrop. Quantitative tightening in the U.S. has long ended, and the Federal Reserve’s interest-rate cut cycle is still at an early stage—meaning a large amount of low-yield capital is looking for new investment opportunities. At the same time, the regulatory environment is improving. For example, frameworks like the U.S. CLARITY Act are clearly defining the regulatory boundaries for digital assets, which is a major positive for institutions entering the market. Even Texas has already included Bitcoin in its state reserves, and the U.S. government is discussing adding Bitcoin to national strategic reserves.

The section on structural demand is especially compelling. The expansion of Bitcoin spot ETFs has completely reshaped the supply-and-demand picture. By the end of 2025, the amount of Bitcoin held by ETFs and DAT is already above 12% of the total circulating supply. Traditional financial giants such as Morgan Stanley and Vanguard also included Bitcoin in their investment platforms in Q4, which suggests that Bitcoin is becoming a bridge connecting traditional capital and the crypto market. On the corporate side, companies like Coinbase and Block have been included in the S&P 500 and the Nasdaq 100. MicroStrategy, as a DAT entity, holds 3.5% of the total supply—none of these are small figures.

One interesting angle is the relationship between Bitcoin and gold. In 2025, the gold price rose by 64.7%, but Bitcoin fell by 6.2%, which seems counterintuitive. However, if you look historically, gold is often a leading indicator. According to ARK’s analysis, Bitcoin should be understood as a high-beta digital extension of gold—logically following the macro narrative around gold prices. What’s particularly interesting is that Bitcoin spot ETFs absorbed the scale that took gold ETFs 15 years to reach in less than two years, indicating that the market’s recognition of Bitcoin as a store of value is rising rapidly.

From the perspective of market structure, Bitcoin’s volatility has clearly been declining. In the past, drawdowns within a cycle often exceeded 70–80%, but in the current cycle (up to February 2026), the maximum drawdown has been only around 50%. Even the least fortunate investors—those who bought $1,000 at the highs every year from 2020 to 2025—were still up 61% by the end of 2025. This shows that holding period and position size matter more than timing, and the market rewards investors who focus on Bitcoin’s value proposition rather than short-term fluctuations.

So Cathie Wood and Ark Invest’s core view is that by 2026, Bitcoin’s story is no longer about “whether it can survive,” but about “its allocation percentage within a portfolio.” Bitcoin is now a scarce, non-sovereign asset: a high-beta extension of traditional value stores, and a globally liquid tool that can be easily accessed through regulated instruments. As regulation and infrastructure improve, institutions and sovereign entities are already absorbing large amounts of new Bitcoin supply. Given Bitcoin’s low correlation with other assets, allocating to Bitcoin may improve a portfolio’s risk-adjusted returns.

This logic is actually quite clear—the issue is no longer “whether to allocate,” but “how much” and “how to allocate.”