[Understand] Which best describes Bitcoin’s annualised volatility as of Q1 2025?
Explanation
Declining from triple digits pre-2020 to 52-54% by 2025; still 3-5x higher than equities. (Source: Fidelity Digital Assets 2024)
[Understand] What is the approximate Sharpe ratio of Bitcoin over 2020–2024?
Explanation
BTC Sharpe 0.96 leads S&P 500 ( 0.65), gold ( 0.55), and bonds ( 0.30) over the period. (Source: Fidelity Digital Assets; stoic.ai 2025)
[Analyze] What happened to Bitcoin’s 90-day rolling correlation with the S&P 500 after January 2024?
Explanation
ETF approval embedded BTC in equity risk-on/risk-off cycles. Correlation rose from 0.2-0.4 pre-ETF to 0.5-0.75 by 2025. (Source: arxiv 2512.12815)
[Apply] At what BTC allocation does the portfolio Sharpe ratio peak (mean-variance analysis)?
Explanation
Beyond 5-10%, volatility drag outweighs the return and diversification benefit. (Source: Grayscale 2025; SSGA 2025)
[Understand] When did the SEC approve the first US spot Bitcoin ETFs?
Explanation
The SEC approved 11 US Bitcoin spot ETFs on January 10, 2024; trading began January 11, 2024.
[Understand] How much AUM did US Bitcoin spot ETFs accumulate by mid-2025?
Explanation
Surpassed combined gold ETF AUM ( $85B) in under 12 months; fastest AUM ramp in ETF history. (Source: The Block; BlackRock Jan 2026)
[Understand] What was Bitcoin’s long-run correlation with gold (2020–2024)?
Explanation
Near-zero correlation despite the “digital gold” narrative; they do not move together in practice. (Source: arxiv 2501.09911)
[Apply] A 5% BTC portfolio (2015–2024 backtest) vs. 0% BTC typically shows:
Explanation
Efficient frontier shifts upward-left at 5% BTC; Sharpe ratio improves due to low correlation and high excess return.
[Analyze] Which risk does the ETF structure ADD compared to holding Bitcoin directly?
Explanation
Coinbase Prime is custodian for BlackRock, Fidelity, and most US spot ETFs; its failure would be systemic.
[Evaluate] Based on 2022 data, which statement about Bitcoin’s “digital gold” narrative is most accurate?
Explanation
The 2022 data definitively challenges the inflation-hedge and safe-haven narratives for BTC.
[Understand] What is Bitcoin’s approximate 10+ year CAGR (2013–2024)?
Explanation
CAGR of approximately 50-60% over the full decade-plus period. (Source: CoinGecko; Fidelity Digital Assets)
[Understand] When did US Ethereum spot ETFs begin trading?
Explanation
The SEC approved Ethereum spot ETFs in May 2024; trading commenced July 23, 2024.
[Understand] Approximate combined AUM of US Ethereum spot ETFs as of Q4 2025?
Explanation
ETH spot ETFs grew slower than BTC due to no staking yield; $46B by end-2025. (Source: Coinglass; XT Exchange 2025 Scorecard)
[Analyze] Which has the lowest POSITIVE correlation with Bitcoin over 2020–2024?
Explanation
Gold’s ≈6% correlation with BTC is near-zero positive; US bonds are negative (-12%) but the question asks for POSITIVE.
[Understand] How many days did BlackRock IBIT take to approach $100B AUM?
Explanation
Fastest ETF to approach $100B; the prior record was Vanguard VOO at 2,011 days. (Source: The Block; BlackRock Jan 2026)
[Evaluate] Bitcoin fell -65% in 2022 while S&P 500 fell -19%. This fact:
Explanation
High positive beta in the 2022 risk-off environment directly refutes the safe-haven and inflation-hedge claims.
[Apply] Which ETF type has a “roll cost” problem reducing tracking accuracy?
Explanation
Futures ETFs roll monthly, incurring 5-8%/year cost; spot ETFs hold actual BTC, eliminating roll costs.
[Understand] Fidelity Digital Assets survey (2024): what % of institutional investors see digital assets in their portfolios?
Explanation
Fidelity’s 2024 survey found over 80% of institutional respondents see a role for digital assets in their allocations.
[Analyze] Primary reason institutional mandates prohibited direct BTC ownership before 2024?
Explanation
The ETF wrapper solved the custody problem; it did NOT solve the volatility problem, which persists.
[Evaluate] A student claims ETF inflows make Bitcoin a better inflation hedge. Best critique?
Explanation
Higher institutional-equity correlation means BTC is more likely to fall during stagflation than to protect against it.
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