Itaú Recommends Bitcoin as a Hedge Against Real Devaluation

Brazil’s largest private bank, Itaú Unibanco, has positioned Bitcoin not as a speculative gamble, but as a strategic hedge against the long-term erosion of the Brazilian real. In a recent strategy note, the São Paulo–based lender argued that rising global uncertainty and persistent domestic currency volatility are forcing investors to rethink traditional portfolio construction.

According to Itaú’s analysts, investors today face a dual challenge: unstable global prices and fluctuations in local currencies. These conditions, the bank said, justify the inclusion of alternative assets that behave differently from fixed income, equities, and domestic investments. Bitcoin, in this context, stands out due to its decentralized structure, global liquidity, and independent market dynamics.

Itaú recommends allocating between 1% and 3% of a portfolio to Bitcoin. This limited exposure is designed to capture returns that are not closely correlated with Brazil’s economic cycles while offering partial protection against currency depreciation. The bank stressed that Bitcoin should not be treated as a core holding, but rather as a complementary allocation tailored to an investor’s risk profile and long-term objectives.

The strategy note highlighted Bitcoin’s historically low correlation with traditional asset classes, arguing that even a small allocation can improve diversification without materially increasing overall portfolio risk. Itaú also emphasized the importance of discipline and patience, warning that short-term price volatility should not drive investment decisions. Attempting to perfectly time Bitcoin or other international assets, the bank cautioned, is often counterproductive.

By setting a maximum allocation of 3%, Itaú aligns itself with progressive global guidance. Major US banks such as Morgan Stanley and Bank of America have similarly suggested Bitcoin allocations of up to 4% for suitable clients. However, Itaú noted that the rationale is particularly relevant for Brazilian investors, given the country’s history of currency weakness and exposure to external shocks.

The bank described Bitcoin as a hybrid asset—part high-risk investment, part global store of value. In an environment marked by shorter economic cycles and diminishing guarantees from fixed income, this hybrid nature may offer a degree of resilience that traditional assets struggle to provide, especially for investors seeking diversification and currency hedging in Brazil’s evolving financial landscape.