Quiz: Crypto as an Asset Class

20 multiple-choice questions · Bitcoin, portfolios, volatility and the ETF revolution · Click an option to check your answer

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Question 1

Which best describes Bitcoin's annualised volatility as of Q1 2025?

  • (A) ~15% (similar to gold)
  • (B) ~30%
  • (C) ~52-54%
  • (D) ~80%
Answer: (C) Declining from triple digits pre-2020 to ~52-54% by 2025; still 3-5x higher than equities. (Source: Fidelity Digital Assets 2024)

Question 2

What is the approximate Sharpe ratio of Bitcoin over 2020-2024?

  • (A) 0.30
  • (B) 0.96
  • (C) 1.45
  • (D) 0.65
Answer: (B) 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)

Question 3

What happened to Bitcoin's 90-day rolling correlation with the S&P 500 after January 2024?

  • (A) Fell to near-zero as speculation declined
  • (B) Rose structurally to 0.50-0.75+
  • (C) Stayed flat ~0.3
  • (D) Became negative
Answer: (B) 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)

Question 4

At what BTC allocation does the portfolio Sharpe ratio peak (mean-variance analysis)?

  • (A) 1%
  • (B) 10%
  • (C) ~5%
  • (D) 15%
Answer: (C) Beyond 5-10%, volatility drag outweighs the return and diversification benefit. (Source: Grayscale 2025; SSGA 2025)

Question 5

When did the SEC approve the first US spot Bitcoin ETFs?

  • (A) November 2021
  • (B) March 2023
  • (C) January 2024
  • (D) July 2024
Answer: (C) The SEC approved 11 US Bitcoin spot ETFs on January 10, 2024; trading began January 11, 2024.

Question 6

How much AUM did US Bitcoin spot ETFs accumulate by mid-2025?

  • (A) \42B
  • (B) \85B
  • (C) ~\164-179B
  • (D) \240B
Answer: (C) Surpassed combined gold ETF AUM (~\85B) in under 12 months; fastest AUM ramp in ETF history. (Source: The Block; BlackRock Jan 2026)

Question 7

What was Bitcoin's long-run correlation with gold (2020-2024)?

  • (A) ~6% (near-zero)
  • (B) ~35%
  • (C) ~55%
  • (D) ~80%
Answer: (A) Near-zero correlation despite the "digital gold" narrative; they do not move together in practice. (Source: arxiv 2501.09911)

Question 8

A 5% BTC portfolio (2015-2024 backtest) vs. 0% BTC typically shows:

  • (A) Lower return, lower vol
  • (B) Same return, higher vol
  • (C) Higher return, modest vol increase, higher Sharpe
  • (D) Lower return, much higher vol
Answer: (C) Efficient frontier shifts upward-left at 5% BTC; Sharpe ratio improves due to low correlation and high excess return.

Question 9

Which risk does the ETF structure ADD compared to holding Bitcoin directly?

  • (A) Blockchain network risk
  • (B) Custodian concentration risk (Coinbase holds ~90% of US spot ETF BTC)
  • (C) Supply inflation risk
  • (D) Smart contract risk
Answer: (B) Coinbase Prime is custodian for BlackRock, Fidelity, and most US spot ETFs; its failure would be systemic.

Question 10

Based on 2022 data, which statement about Bitcoin's "digital gold" narrative is most accurate?

  • (A) Confirmed: BTC rose while equities fell
  • (B) Confirmed: BTC and gold fell similarly
  • (C) Rejected: BTC fell -65% while S&P 500 fell -19%; BTC is risk-on, not a safe haven
  • (D) Irrelevant: only matters in hyperinflation
Answer: (C) The 2022 data definitively challenges the inflation-hedge and safe-haven narratives for BTC.

Question 11

What is Bitcoin's approximate 10+ year CAGR (2013-2024)?

  • (A) ~12%
  • (B) ~25%
  • (C) ~50%+
  • (D) ~100%
Answer: (C) CAGR of approximately 50-60% over the full decade-plus period. (Source: CoinGecko; Fidelity Digital Assets)

Question 12

When did US Ethereum spot ETFs begin trading?

  • (A) January 2024
  • (B) March 2024
  • (C) July 23, 2024
  • (D) January 2025
Answer: (C) The SEC approved Ethereum spot ETFs in May 2024; trading commenced July 23, 2024.

Question 13

Approximate combined AUM of US Ethereum spot ETFs as of Q4 2025?

  • (A) \8B
  • (B) \22B
  • (C) ~\46B
  • (D) \90B
Answer: (C) ETH spot ETFs grew slower than BTC due to no staking yield; ~\46B by end-2025. (Source: Coinglass; XT Exchange 2025 Scorecard)

Question 14

Which has the lowest POSITIVE correlation with Bitcoin over 2020-2024?

  • (A) S&P 500 (~0.52)
  • (B) Gold (~0.06)
  • (C) Real Estate (~0.18)
  • (D) US Bonds (-0.12, negative)
Answer: (B) Gold's ≈6% correlation with BTC is near-zero positive; US bonds are negative (-12%) but the question asks for POSITIVE.

Question 15

How many days did BlackRock IBIT take to approach \100B AUM?

  • (A) 211 days
  • (B) ~435 days
  • (C) 800 days
  • (D) 2,011 days (same as Vanguard VOO)
Answer: (B) Fastest ETF to approach \100B; the prior record was Vanguard VOO at 2,011 days. (Source: The Block; BlackRock Jan 2026)

Question 16

Bitcoin fell ~-65% in 2022 while S&P 500 fell ~-19%. This fact:

  • (A) Confirms safe-haven status (fell less than 2008 crisis)
  • (B) Is irrelevant to the digital gold thesis
  • (C) Challenges the safe-haven narrative: BTC showed high equity beta, not uncorrelated behaviour
  • (D) Proves Bitcoin outperforms gold in all conditions
Answer: (C) High positive beta in the 2022 risk-off environment directly refutes the safe-haven and inflation-hedge claims.

Question 17

Which ETF type has a "roll cost" problem reducing tracking accuracy?

  • (A) Futures-based ETF (e.g., ProShares BITO, approved Oct 2021)
  • (B) Spot ETF (e.g., IBIT, approved Jan 2024)
  • (C) Both equally
  • (D) Neither
Answer: (A) Futures ETFs roll monthly, incurring ~5-8%/year cost; spot ETFs hold actual BTC, eliminating roll costs.

Question 18

Fidelity Digital Assets survey (2024): what % of institutional investors see digital assets in their portfolios?

  • (A) ~30%
  • (B) ~50%
  • (C) ~65%
  • (D) ~80%+
Answer: (D) Fidelity's 2024 survey found over 80% of institutional respondents see a role for digital assets in their allocations.

Question 19

Primary reason institutional mandates prohibited direct BTC ownership before 2024?

  • (A) Bitcoin's vol exceeded all risk limits
  • (B) Bitcoin had negative expected returns
  • (C) Crypto self-custody was incompatible with fiduciary duty and mandate custody rules
  • (D) No regulated exchanges existed
Answer: (C) The ETF wrapper solved the custody problem; it did NOT solve the volatility problem, which persists.

Question 20

A student claims ETF inflows make Bitcoin a better inflation hedge. Best critique?

  • (A) Correct: institutional flows always improve inflation-hedging
  • (B) Wrong: ETFs reduced volatility so much that it no longer hedges
  • (C) Flawed: higher equity correlation means BTC now moves with risk-on sentiment, not against inflation
  • (D) True short-term, false long-term
Answer: (C) Higher institutional-equity correlation means BTC is more likely to fall during stagflation than to protect against it.