U.S. Spot Bitcoin ETF Approval: How to Compare Bitcoin, Stocks, Bonds, and Commodities Under a Crypto Industry Milestone

After the approval of the U.S. spot Bitcoin ETF, many investors who previously focused only on stocks, bonds, or commodities began comparing Bitcoin on the same asset-allocation sheet. The key to understanding this issue is not to ask, “Will Bitcoin replace traditional assets?” but to ask: What kind of asset does it actually resemble, and what does it not resemble? If Bitcoin is treated as a normal security simply because an ETF was approved, volatility and custody differences may be underestimated; if it is still completely excluded from a multi-asset view, one may miss an asset class that has already entered mainstream financial infrastructure discussions.

What Changed and What Did Not Change After Spot ETF Approval

The approval of the U.S. spot Bitcoin ETF is viewed by many market participants as an important milestone for the crypto industry because it has put Bitcoin exposure into a more familiar securities-market framework. For some investors, this lowers barriers such as opening exchange accounts, making on-chain transfers, and managing private keys, and it also makes asset reporting, compliance workflows, and rebalancing within accounts easier.

But what the ETF changes is the "access method," not the "asset essence." Spot ETFs typically hold or track underlying spot Bitcoin exposure through a fund structure; investors trade fund units, not direct control over on-chain BTC. Fund units can be traded during securities market hours, and prices are influenced by secondary-market supply and demand, market making, creation/redemption mechanisms, and fee structures, while the Bitcoin network itself remains an always-on open network where assets are controlled by private keys.

Therefore, ETF approval has brought at least three layers of impact:

• Access layer: it makes Bitcoin price exposure easier to obtain for traditional brokerage account users.
• Market structure layer: it adds roles such as compliant custodians, authorized participants, market makers, index providers, and fund managers.
• Narrative layer: it strengthens the legitimacy and visibility of Bitcoin being included in mainstream asset discussions.

At the same time, it has not eliminated the following facts: Bitcoin has no legal cash flow and no issuer that promises redemption; its price may still swing sharply. ETF holders do not directly own on-chain private keys. Fund structures can still create fees, tracking error, trading discounts/premiums, and custody dependence. Understanding these boundaries is the starting point for comparing Bitcoin, stocks, bonds, and commodities.

Comparison Dimensions: First Look at What Each Asset Is Priced By

When comparing four types of assets together, the easiest mistake is to only look at past returns. A more robust approach is to first distinguish their own sources of return and pricing anchors.

Stocks represent a claim on corporate equity, and long-term performance is generally linked to corporate earnings, capital returns, and economic growth. Bonds represent creditor relationships, with returns coming largely from coupons and principal repayment; prices are highly sensitive to interest-rate changes. Commodities do not represent companies and do not generate cash flow; they more directly reflect physical supply-demand, inventory cycles, energy costs, and geopolitical shocks. Bitcoin is more unique: it has no traditional cash flow, but it has verifiable issuance rules, a capped supply narrative, a global trading market, and digital-native settlement characteristics.

So Bitcoin cannot be simply equated with technology stocks, nor simply with gold. In some periods it may behave like a high-beta risk asset; in some narratives it is also seen as a scarcity asset. In comparison, this multi-attribute nature should be acknowledged instead of forcing it into a single label.

Returns and Volatility: Compare Drawdown Depth, Not Just Upside

Bitcoin has shown very high episodic gains in history and has also gone through multiple large drawdowns. High return expectations and high volatility are two sides of the same coin. Compared with stock indices, investment-grade bonds, or most commodities, Bitcoin’s annualized volatility is usually higher, and its price is more easily affected by liquidity, leverage, exchange flows, regulatory headlines, and market sentiment.

Stocks are also volatile, but broad equity indices are backed by diversified corporate earnings. Even if stock prices fall in the short term, investors can still use earnings, dividends, buybacks, and valuation levels to assess some fundamental changes. Bond volatility is usually lower than equities, but when rates rise rapidly or credit risk increases, long-duration bonds and lower-credit bonds can also fall significantly. Commodity prices can fluctuate sharply due to war, weather, inventories, capacity, transportation, and policy changes, and volatility differs greatly across commodities.

When comparing returns and volatility, you can use three questions:

1. Where does the upside come from? Is it earnings growth, rate cuts, supply shortages, capital inflows, or valuation and sentiment re-rating?
2. Is there cash-flow cushioning when falling? Stocks may have dividends and earnings, bonds may have coupons, while commodities and Bitcoin generally have no fixed cash flow.
3. Can you bear severe drawdowns? If an asset drops 30% or 50%, would you be forced to sell?

A concrete example: suppose an investor has investable assets equivalent to 1,000,000 yuan, with 60% in stocks, 30% in bonds, and 10% in cash. If a 5% Bitcoin exposure is added, the share looks small on paper; but if Bitcoin falls 50%, the portfolio loses about 2.5% directly. If stocks also fall 20% due to liquidity contraction, the drawdowns compound. At that point, what matters more is not whether Bitcoin rises over the long term, but whether the investor has preset rules for rebalancing, stop-loss, or holding.

Liquidity and Trading Hours: A 24/7 Market Is Not the Same as a Securities Market

The Bitcoin spot market operates 24/7, and the on-chain network has no traditional weekend market closure. Global trading platforms, market makers, derivatives markets, and on-chain transfers together form its liquidity structure. By contrast, stocks and bonds mainly trade on their respective exchanges or OTC markets during business days, while commodities have both spot and futures markets with trading hours determined by exchanges and contract terms.

The U.S. spot Bitcoin ETF allows investors to trade fund units during securities-market hours, but this creates a difference: the underlying Bitcoin market can still move on weekends while the ETF units usually reflect price changes only after securities markets open. If major news occurs on weekends or holidays, the ETF open can gap.

Liquidity should not be judged only by whether trading is possible. You also need to look at:

• Bid-ask spread: high volume does not mean trading is low-cost at every moment.
• Market depth: whether large orders will materially move prices.
• Stress conditions: whether market making, creation/redemption, and trading channels remain stable in volatile periods.
• Settlement cycle: settlement arrangements differ across brokerage accounts, on-chain transfers, OTC trades, and futures margin.

Bonds in particular require caution against liquidity illusion. Many bonds do not trade as continuously and transparently as large-cap stocks; during stress, liquidity in credit bonds can drop noticeably. Commodity markets can face complex constraints due to contract expiry, delivery rules, storage costs, and limit-up/-down mechanisms. Bitcoin’s advantage is global 24/7 quotation and on-chain transferability, but in extreme markets, exchange congestion, rising on-chain fees, stablecoin de-pegging risk, or derivative liquidations can further amplify volatility.

Cash Flow and Valuation: Why Bitcoin Is Hard to Value With Traditional Models

Stocks and bonds can use relatively mature valuation models because they usually have cash flows. Stock valuation can reference P/E, P/S, discounted free cash flow, dividend yield, return on equity, and other indicators. Bonds can be analyzed with yield to maturity, duration, convexity, credit spread, and default probability. While these models can be wrong, they at least have relatively clear cash-flow foundations.

Bitcoin does not generate interest or dividends, and there is no issuer commitment to buy back or redeem. So traditional discounted-cash-flow valuation is not directly applicable to Bitcoin. Common alternative observation angles in the market include:

• Supply rules: issuance pace, halving mechanism, circulating supply, and long-term holder behavior.
• Network activity: active addresses, transaction fees, settlement value, miner revenue, and other on-chain indicators.
• Market structure: spot-futures basis, ETF flows, exchange balances, leverage levels.
• Macro liquidity: USD liquidity, real interest rates, and risk-asset risk appetite.
• Narrative and adoption: institutional onboarding, payment or store-of-value use cases, regulatory stance, technological ecosystem.

These indicators can help you understand market conditions, but none is a guaranteed valuation formula for returns. For example, higher on-chain activity may indicate increased usage, but it could also stem from short-term speculation or inscription and fee-cycle effects; declining exchange balances may mean stronger long-term holding intent, or simply custody migration.

Investors should avoid treating any single indicator as absolute.

Commodities also have no cash flow, but unlike Bitcoin, many commodities have industrial, energy, agriculture, or jewelry demand and are constrained by inventories and production costs. Comparisons between gold and Bitcoin are common because both are often discussed as scarcity assets; however, gold has long-term physical demand, central-bank reserves, and a mature derivatives market, while Bitcoin has digital transferability, verifiable scarcity, and higher volatility. Their similarity is that they are both non-cash-flow assets; what differs is market history, holder structure, use cases, and regulatory framework.

Inflation and Interest-Rate Sensitivity: A Scarcity Narrative Is Not a Stable Hedge

Inflation and rates are variables that cannot be ignored when comparing assets. Bonds are most directly sensitive to rates: when rates rise, existing bond prices usually fall, and longer duration means a larger impact; credit bonds are also affected by the economic cycle and default risk. Equities are sensitive to rates via discount rates and earnings expectations; growth stocks are often more rate-sensitive because their valuations rely more on distant cash flows.

The commodity-inflation relationship is more intuitive. Energy, agricultural, and industrial-metal price increases can themselves push inflation higher, and some commodities can perform strongly when supply shocks occur. But commodities are not always inflation hedges; if demand falls in a recession, prices can also decline. Gold is often seen as a hedge against inflation or monetary-credit risk, yet its short-term performance is also affected by real rates, the dollar, and central-bank demand.

Bitcoin is more complex. Its supply cap and halving mechanism support a strong scarcity narrative, which is why it is often called "digital gold." In the short to medium term, however, Bitcoin’s price is not determined only by inflation. In periods of rising real rates, a stronger dollar, tighter liquidity, or weakening risk appetite, Bitcoin may be pressured like a high-risk asset. Conversely, when liquidity is accommodative, risk appetite recovers, or market attention shifts to currency debasement narratives, it may perform stronger.

Therefore, Bitcoin can be viewed as an asset that may benefit from long-term scarcity narratives and monetary-system discussion, but it should not be treated as a stable, linear inflation hedge. Especially when the investment horizon is short or capital needs are rigid, using a high-volatility asset to hedge everyday inflation can introduce greater equity volatility.

Correlation and Diversification: Correlations Change Under Market Stress

A common saying in asset allocation is "don’t put all your eggs in one basket," but effective diversification is not just about holding many assets; it is about holding assets that do not move fully in sync across different environments. The correlation among stocks, bonds, commodities, and Bitcoin is not fixed and can change with macro regimes, market stress, and capital structure changes.

In some periods, stocks and bonds can be negatively correlated, with bonds cushioning stock declines; but during high inflation and rapidly rising rates, both stocks and bonds can fall together. Commodities may behave differently from stocks and bonds during supply shocks or inflation phases, but can also weaken when the economy slows. Bitcoin’s correlation with risk assets like technology or growth stocks sometimes rises, and at other times it breaks out on its own due to its own cycle, halving narratives, or sector-specific events.

This means whether Bitcoin improves a portfolio should not be judged by a single year or a single bull-market phase alone. A more reasonable approach is scenario analysis:

• Looser liquidity and rising risk appetite: stocks and Bitcoin may both benefit, with higher correlation.
• Rapid rate increases: long-duration bonds and high-valuation stocks are pressured, and Bitcoin may also fall as risk appetite weakens.
• Energy supply shock: some commodities may rise, while stocks and bonds may be pressured by cost and rate effects.
• Internal crypto industry risk events: Bitcoin may face isolated pressure while traditional assets may react less.
• Rising concerns about monetary credit risk: gold, some commodities, and Bitcoin’s scarcity narrative may gain attention, but performance magnitude and stability differ.

An actionable checklist is as follows:

1. List target weights and maximum allowed deviations for each asset class in your portfolio.
2. Assume stocks fall 25%, bonds fall 10%, Bitcoin falls 50%, commodities rise or fall 20%, and observe portfolio NAV changes.
3. Check whether selling assets under extreme conditions is needed to meet liquidity needs.
4. Set a rebalancing frequency, such as quarterly, semiannually, or when deviation thresholds are triggered, rather than trading based on short-term reactions.
5. Distinguish between "strategic allocation" and short-term trading, and avoid letting long-term narratives mask short-term speculation.

The goal of diversification is not to eliminate losses, but to ensure a portfolio does not become entirely dependent on a single variable under different shocks. Bitcoin can be an observation target, but its high volatility means it can materially contribute to portfolio risk even at a small allocation.

Custody and Access Method: Differences Among ETF, Exchange, and Self-Custody

After the approval of the U.S. spot Bitcoin ETF, investors have at least three common access methods: buying the spot ETF through a brokerage account, buying BTC on a crypto exchange, or moving BTC to a self-custody wallet. These are not simply better-or-worse options; they are trade-offs among control, convenience, and responsibility.

Holding via ETF has the advantage of being close to traditional securities-investment workflows, suitable for investors who already have a broker account, need reporting integration, or are constrained by internal compliance processes. Its limitation is that investors hold fund units, not direct on-chain ownership; they must also pay attention to fund fees, tracking error, trading discounts/premiums, custody arrangements, and securities market trading hours.

Holding via exchange has the advantage of easier trading and conversion, and may provide access to more coins, stablecoins, and derivatives tools. Its limitation is investor dependence on the platform’s account system, risk controls, withdrawal policies, and asset safety management. Exchange bankruptcies, misappropriation of client assets, and withdrawal suspensions have occurred in the crypto industry, so exchange balances should not be treated as equivalent to on-chain self-owned assets.

Self-custody holding has the core feature that the user controls private keys or seed phrases, thereby directly controlling on-chain BTC. This aligns with Bitcoin’s native design philosophy and reduces reliance on a single centralized platform. But self-custody transfers responsibility to the user: losing seed phrases, phishing-signed messages, address-copy mistakes, malware, and improper backups can all cause irreversible losses. Hardware wallets, multi-signature setups, offline backups, and small test transfers are important methods to reduce operational risk.

The hardware-wallet and self-custody approach advocated by OneKey is suitable for users who want long-term direct on-chain ownership and prioritize private key control. But this does not mean everyone must self-custody, and it does not mean self-custody has no barriers. For different investors, a more practical question is: do you want to place risk in the custody provider, the exchange platform, or your own private-key management process?

A Multi-Asset Comparison Framework for Individual Investors

To include Bitcoin in a multi-asset comparison, you can use a simplified framework to avoid emotional decisions.

Step One: Clarify the nature of the funds

Capital intended for short-term living expenses, mortgage payments, tuition, or working capital is not suitable for large drawdowns from high-volatility assets. Long-term capital should also be distinguished by whether it has stable cash-flow support and whether it can tolerate multiple years of weak performance.

Step Two: Define each asset’s role

Stocks may take on a long-term growth role; bonds may serve a cash-flow and volatility-buffer role; commodities may provide inflation or supply-shock exposure; Bitcoin may serve as a high-volatility scarcity and digital-asset exposure. If the roles differ, the evaluation metrics should also differ.

Step Three: Choose access method

If the goal is simply price exposure, an ETF may be simpler; if the goal is on-chain usage, long-term self-management, and asset verification, self-custody is more aligned with native attributes; if the goal is frequent trading, one needs to understand exchange and derivatives risks. The access method itself is part of the risk profile.

Step Four: Set a risk budget

Ask not only "how much can I make," but "how much can I lose while still staying on plan." For high-volatility assets, even a small allocation can contribute disproportionately to risk. You can constrain this with maximum drawdown, volatility, stress testing, and rebalancing rules instead of adding based on feeling.

Step Five: Review regularly instead of predicting constantly

Macro rates, regulatory environments, ETF flows, on-chain activity, market leverage, and technological development all change. Regularly reviewing whether each asset’s role still holds is more important than trying to predict every price turning point.

Conclusion: A Milestone Is Not a Universal Label, and Framework Matters More Than a Single Conclusion

The U.S. spot Bitcoin ETF approval is indeed an important step for the crypto industry entering mainstream financial visibility. It has improved access channels for some investors and made Bitcoin easier to include in asset allocation, risk management, and institutional research frameworks. But a milestone does not equate to low-risk certification, nor does it mean Bitcoin can be directly ranked on a single ruler with stocks, bonds, and commodities.

Stocks have corporate earnings and equity characteristics, bonds have coupons and redemption structures, commodities have physical supply-demand and inventory cycles, and Bitcoin is built on an open network, fixed issuance rules, global liquidity, and a digital scarcity narrative. All of them may play roles in a portfolio, but their roles, risks, and valuation logic are different.

A more prudent boundary is this: analyze Bitcoin as a high-volatility, non-cash-flow, technology- and market-structure-driven asset within a multi-asset framework; replace pure price prediction with stress testing and custody checks; and choose ETF, exchange, or self-custody based on your own horizon, cash needs, tax and regulatory environment. No indicator, tool, or allocation ratio can guarantee returns. The real value is understanding, before entering the market, where your risk actually comes from.

References

1. US Bitcoin Spot ETF Approval: A Milestone for Crypto：https://trustwallet.com/en/blog/academy/bitcoin-spot-etf-approval-a-milestone-for-crypto
2. Statement on the Approval of Spot Bitcoin Exchange-Traded Products：https://www.sec.gov/news/statement/gensler-statement-spot-bitcoin-011023
3. Bitcoin: A Peer-to-Peer Electronic Cash System：https://bitcoin.org/bitcoin.pdf
4. Investor Bulletin: Exchange-Traded Funds (ETFs)：https://www.sec.gov/investor/alerts/etfs.pdf
5. CME CF Bitcoin Reference Rate：https://www.cmegroup.com/markets/cryptocurrencies/cme-cf-cryptocurrency-benchmarks/cme-cf-bitcoin-reference-rate.html
6. OneKey Blog：https://onekey.so/blog

Risk Warning

This article is for educational and informational purposes only and does not constitute investment advice, solicitation, or any return guarantee. Bitcoin, stocks, bonds, commodities, and related ETFs all carry market price volatility risk and may experience significant drawdowns or even principal loss; ETFs may also involve risks related to fees, tracking error, discounts/premiums, creation/redemption, and fund custody. Bitcoin and crypto assets face technical and custody risks such as irreversible on-chain transfers, private-key loss, phishing attacks, and security incidents involving smart contracts or exchanges; holding through exchanges or custodians also involves counterparty, withdrawal, and operational risks. Bonds involve interest-rate, credit, duration, reinvestment, and liquidity risks; commodities involve supply-demand, inventory, delivery, roll, geopolitical, and policy risks. Using leverage, margin, futures, or options can magnify losses and may trigger forced liquidation. Regulatory requirements for crypto assets, ETFs, taxes, and investor suitability differ across jurisdictions and may change; relevant rules may vary, so before investing, investors should consider their own circumstances and consult qualified professionals.