The honest answer is almost certainly more than the 1–5% the industry recommends. Here is the math it skips, and what Bitcoin is actually replacing.
Pick a time horizon and the risk level you are comfortable with, anchored to the classic stock and bond blends. The optimizer finds the mix of stocks, the safe asset, and Bitcoin that earns the most at that risk. Then flip the safe asset from today's bonds to a 9% Bitcoin-backed credit sleeve, the rate that exists in the free market, and watch the whole portfolio change.
| Portfolio | Stocks | Bonds | Credit | Bitcoin | Return | Risk |
|---|---|---|---|---|---|---|
| Before: classic 60/40 | 60% | 40% | 0% | 0% | 9.5% | 10.2% |
| After: optimized | 40% | 54% | 0% | 6% | 10.2% | 10.0% |
Assumptions (10-year total return, real data through July 2026 via FMP and CryptoCompare; the 9% credit sleeve is a Cadena target at low, defined risk): stocks 15.0% return / 15.3% std dev; bonds 1.3% / 5.1%; Bitcoin-backed credit 9.0% / 2.0%; Bitcoin 57.8% / 73.8%. Correlations: stock-bond 0.4, stock-Bitcoin 0.33, bond-Bitcoin 0.15.
The other half is what Bitcoin replaces. Modern portfolio theory gave us the 60/40: equities for growth, bonds for the safe asset. The problem is that the safe asset is no longer safe. Stocks and bonds fell together in 2022, the model's worst year on record. Bonds spent much of the last fifteen years paying no real yield, and long Treasuries lost roughly 30% in 2022.
The deeper issue is the label. The economics and credit quality of sovereign debt have steadily deteriorated, yet we still call it risk-free. A government bond is a claim on an issuer whose fiscal path keeps worsening, repaid in a currency it can print at will. In a world where central banks stop buying the bonds to suppress the rate, the market clears far higher, and a 9% real yield on sound-money collateral is what the safe asset should actually pay.
The optimized portfolio at your 60/40 risk level over 10 years, sized to your net worth, with the safe asset set to bonds above.
This is today’s world, with bonds as the safe asset. Flip the safe asset to the 9% credit sleeve above and watch the optimizer rebuild the portfolio.
Two lenses on Bitcoin sizing. This optimized portfolio holds 6% in Bitcoin; your conviction-based Kelly number above was 23% ($233k, 3.89 BTC). One is bounded by risk, the other by conviction; the right answer sits between them.
This is the argument of Endgame, out now. And the 9% credit layer that replaces bonds is what we build at Cadena.
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