Bitcoin News Today: Itaú Backs Bitcoin as Institutional Tool Amid Brazil's Crypto Push

Brazil's Digital Asset Transformation: Itaú's Bitcoin Strategy

Brazil's largest private bank, Itaú Unibanco, has recommended that investors allocate between 1% and 3% of their portfolios to Bitcoin by 2026. The advice, issued by Itaú Asset, the bank's investment arm, is intended to help diversify risk and hedge against currency fluctuations. The research underscores Bitcoin's growing role in institutional portfolios.

The move aligns with a broader shift in Brazil toward digital assets. Itaú Asset cited Bitcoin's unique global and decentralized structure as a key advantage, particularly in times of geopolitical uncertainty and economic instability. The bank emphasized that Bitcoin's volatility does not negate its long-term potential.

Analysts have noted that Bitcoin's distinct behavior compared to traditional assets makes it a valuable diversification tool. Itaú's report, authored by Renato Eid, highlights how the cryptocurrency can serve as a complementary component in portfolios, offering returns uncorrelated with domestic market cycles.

The recommendation comes amid increased regulatory clarity and growing institutional interest in Brazil.

Institutional Adoption and Regulatory Progress

Brazil is experiencing a rapid transformation in its approach to digital assets. The country's Central Bank is set to implement a comprehensive regulatory framework for virtual assets in February 2026. The new rules will require all crypto companies to be licensed and will apply existing banking regulations to the industry.

A major piece of legislation is also advancing in the Brazilian parliament, which could establish a Sovereign Strategic Bitcoin Reserve (RESBit). This proposed reserve would allocate up to 5% of the country's international reserves into Bitcoin. If passed, Brazil would become the first G20 nation to hold Bitcoin in its official reserves.

The shift is not limited to government action. Itaú's research, which the bank has already established, a dedicated team for digital assets formed in September 2025, to develop innovative crypto investment products. The team prioritizes security and accessibility for clients, reflecting the growing institutional confidence in the space.

Portfolio Diversification and Risk Management

Itaú's recommendation is part of a global trend where major financial institutions are incorporating small crypto allocations into portfolios. The bank joins firms like Morgan Stanley and Bank of America in advocating for modest Bitcoin exposure, typically between 1% and 4%.

The rationale is based on Bitcoin's low correlation with traditional asset classes. According to Itaú's internal data, BITI11, its Bitcoin ETF, shows minimal correlation with stocks, bonds, and real estate. This characteristic makes it an effective tool for balancing risk in a portfolio.

The bank also noted that currency movements have historically had a significant impact on Bitcoin's local performance in Brazil. For example, in 2025, the real's strength against the dollar amplified losses for investors with dollar-denominated crypto assets. The 1%–3% allocation is designed to help mitigate such risks.

Market Outlook and Institutional Strategies

Looking ahead, Itaú plans to expand its crypto offerings by developing a range of products, from fixed-income-style instruments to high-volatility derivatives and staking solutions. These developments aim to cater to different investor preferences and risk tolerances.

Bitcoin's price has remained relatively stable near $90,000 following a period of consolidation. Analysts suggest that further support for the asset could come from continued institutional adoption and favorable macroeconomic conditions. The Federal Reserve's recent liquidity injections and potential rate cuts have also been cited as catalysts for a renewed Bitcoin rally.

The bank's research highlights the importance of disciplined portfolio management when it comes to volatile assets like Bitcoin. Itaú advises investors to approach crypto allocations with long-term strategies and to avoid overreacting to short-term price swings.

What This Means for Investors

For individual investors, Itaú's guidance signals a growing acceptance of Bitcoin as a legitimate part of a diversified portfolio. The bank's recommendation is especially relevant in an environment of currency instability and global uncertainty.

The low allocation of 1%–3% reflects a cautious approach, balancing potential returns with risk management. Investors are encouraged to use Itaú's Íon investment platform or the BITI11 ETF to access Bitcoin exposure. These tools offer a regulated and secure way to participate in the digital asset space.

The move by Itaú, combined with regulatory progress at the national level, is expected to accelerate broader adoption of Bitcoin in Brazil. As the country continues to integrate digital assets into its financial system, it may serve as a model for other emerging markets seeking to balance innovation with stability.