Bitcoin has emerged as an unstoppable force over the past decade, outperforming all traditional assets in terms of performance.
The market-leading cryptocurrency, Bitcoin, has revolutionized the traditional investment landscape, which had dominated for decades. Over the past ten years, Bitcoin has managed to an impressive performance of over 26.900%, surpassing any other asset in the financial field.
To put this into perspective, CoinGecko noted in a recent report that a $100 investment in Bitcoin in 2014 would be worth over $26.930 by 2024. This astonishing return not only highlights Bitcoin’s potential as an investment asset, but also calls into question the efficacy of traditional assets in an increasingly digitalized and decentralized market.
Despite its notable volatility, Bitcoin has proven to be a top-performing asset, outshining stocks, bonds, and other conventional investments. Even the S&P 500, considered a key indicator of the stock market, has significantly underperformed Bitcoin, returning 193,3% over the same period. Gold, traditionally seen as a store of value, has returned just 125,8% over the past decade, while 5-year and 10-year Treasury bonds have returned between 157,1% and 86,8%, respectively. Lastly, crude oil, a crucial asset in the global economy, has also underperformed Bitcoin, with only 4,3% growth over the past decade.
Source: CoinGecko
These data not only reflect Bitcoin's superiority in terms of performance, but also its ability to adapt and grow in an increasingly complex and volatile economic environment. As blockchain technology has become more established and cryptocurrency adoption has increased, Bitcoin has proven to be more than just a fad, becoming a A legitimate and attractive asset for investors worldwide.
Bitcoin excels on all time horizons, both 5 years and 1 year
Bitcoin's superiority is not limited to a 10-year horizon. According to the report According to CoinGecko, over a 5-year period, Bitcoin has recorded a return of 1.283,6%, a figure that remains unmatched by other traditional assets. For example, the S&P 500 has returned 96,7% over this period, while gold has returned 84,6%, and 5-year Treasury bonds have returned 157,1%. Crude oil, with a return of 25,3%, remains the asset with the lowest return over this period.
This 5-year performance reflects Bitcoin’s ability to maintain and increase its value over time, even amid economic and geopolitical fluctuations.
Source: CoinGecko
Over a 1-year period, Bitcoin’s performance has been equally impressive, up 153,1%. In this period, gold has returned 34,8%, the S&P 500 33,1%, and 5-year Treasury bonds have recorded losses of 4,3%. Crude oil, with a negative return of 3,8%, has been the asset most affected by market volatility over this period.
The above data shows that even in a shorter time frame, Bitcoin remains the most profitable asset on the market. Bitcoin’s ability to outperform other assets across different time frames reinforces its position as a solid and potentially lucrative investment.
Bitcoin's correlation with other investment assets
In addition to performance, CoinGecko's report also assessed Bitcoin's relationship to other traditional assets, in order to provide a more detailed insight into its behavior in the market.
Over the years, Bitcoin’s correlation with the S&P 500 has been inconsistent, often hovering near zero until 2018. This low correlation suggests that Bitcoin was behaving independently of the stock markets during that period. However, since 2020, the relationship has strengthened, with Bitcoin becoming more closely aligned with stocks during major economic events, such as the Covid-19 pandemic.
When it comes to gold, Bitcoin’s correlation is inverse to its correlation with the S&P 500, suggesting that Bitcoin and gold often move independently of each other, despite both being considered alternative investments. As for Treasury bonds, Bitcoin’s relationship with these assets has been less clear. Treasury bonds, known for their stability and safety, have shown a weak correlation with Bitcoin, suggesting that investors are looking for different types of assets to diversify their portfolios and mitigate risk.
CoinGecko's report also highlighted that Bitcoin cycles, which occur every four years after the halving, have been marked by significant corrections after each rally. However, the current cycle has been driven by other key factors such as the US presidential election and the growing institutional interest in cryptocurrencies. Donald Trump's victory has raised expectations of more favorable policies towards Bitcoin, leading to a notable increase in its price. The ever-increasing institutional demand for BTC has also highlighted that Bitcoin has become a key asset in the global financial landscape.
