3 Takeaways from “Macro, Money, and the Role of Bitcoin"

In a recent episode of The Value Exchange, host Chris Kuiper (Vice President of Research at Fidelity Digital Assets®) and Jurrien Timmer (Director of Global Macro at Fidelity Investments®) explored the long-term role of bitcoin, shifting macro conditions, and evolving market dynamics. 

Below is a high-level overview of their conversation featuring three key takeaways for institutional investors. 

Takeaway 1: Portfolios May Need to Evolve to Match Today’s Financial Landscape

Chris and Jurrien began their discussion by sharing how deglobalization, inflation, and policy shifts are actively reshaping the market—prompting investors to reassess which assets are most effective in a modern portfolio.

As Jurrien said, “the status quo we’ve been in for so long is being challenged… from a dollar, U.S.-vendor-financed world order to something more transactional.” This marks a departure from the globalization-driven environment that defined the market for several decades.

Chris and Jurrien expanded on this concept, highlighting the lasting impact of the COVID-19 pandemic. “We had a long run from the late 1990s until the pandemic,” noted Jurrien. “Not only was inflation falling, but the volatility of inflation was also very low.” However, it appears as though that long-standing trend has given way to a more complex regime.

Relying on past assumptions may no longer be sufficient. Looking ahead, portfolios will likely need to evolve and consider emerging opportunities such as digital assets to remain resilient amid today’s shifting dynamics.

Takeaway 2: Bonds May No Longer Play Their Traditional Role

As the conversation moved toward bonds, Chris and Jurrien agreed that recent market dynamics have challenged the long-held view that bonds serve as reliable source of diversification and downside protection. 

“Over the past ten years, the compound annual growth rate for fixed income has been 1–2%. And that’s nominal—not real,” said Chris. Bonds continue to exhibit low volatility, but their effectiveness as a hedge may warrant closer examination. Chris continued exploring the concept, noting that holders have faced drawdowns as steep as 55% in real terms.

Jurrien went on to underscore this shift: “2022 was a good reminder [that bonds aren’t always a consistent stabilizer]. Bonds went from being the port in the storm to actually being the storm itself.” 

This raised a final question for Chris and Jurrien: If bonds no longer fulfill their historical function, what other macro assets have the potential to? 

Takeaway 3: Bitcoin Potentially Offers a Unique Investment Opportunity

Looking ahead, Chris and Jurrien proposed that alternative assets such as bitcoin may be well-positioned to serve complementary roles.

Bitcoin’s structure as a scarce, decentralized asset has frequently drawn comparisons to gold in the past. While still volatile, its expanding network and improving maturity suggest its potential to offer a new opportunity in diversified portfolios. 

Chris also explained how bitcoin has previously demonstrated more “good volatility” than bad, as its past upside movements have outweighed drawdowns. “Bitcoin’s price has historically grown 6x with every 40% increase in its age,” he noted, emphasizing its potential for long-term network-driven growth. 

Jurrien continued with his own commentary on bitcoin’s nature as a network asset, noting that it gains strength and value as adoption increases. He also stated that as the global money supply expands, demand for scarce, non-sovereign assets such as bitcoin could accelerate. 

While increasing institutional adoption has made it difficult to measure bitcoin’s growth directly, the underlying thesis remains: Bitcoin has the potential to serve as a hedge alongside other alternative assets in the years to come.

Conclusion

Today’s shifting financial landscape requires an evolving perspective based on an investor’s unique goals. Find deeper insights from Chris and Jurrien into the changing role of bonds, the rise of decentralized assets, and bitcoin’s long-term growth in the full episode of The Value Exchange.

Interested in discussing what a modern investment strategy may look like in today’s financial landscape? Get in touch.