Bitcoin Surges, Outperforms Traditional Finance Assets
Bitcoin (BTC) experienced a rally this week, rising from its lowest price of $26,814 on Sunday to a high of $30,233 on October 20. This upward movement once again demonstrates the lack of correlation between Bitcoin and core stock market indexes.
A performance analysis conducted on October 20 by CryptoRank revealed that Bitcoin has outperformed traditional finance assets and Ethereum (ETH) year-to-date. Bitcoin accrued over 4,000 basis points (bps) more than ETH, making it the best-performing asset. Both cryptocurrencies also outperformed NASDAQ and the SPY.
In fact, Bitcoin and Ethereum saw gains of 79.7% and 34.9% respectively, surpassing NASDAQ’s gains by 5,280 bps and 800 bps. The SPY and Gold lagged behind with accumulated gains of 13.2% and 7.03% each in 2023.
Bitcoin is a “Flight to Quality” vs. Traditional Finance
Larry Fink, CEO of BlackRock Inc., acknowledged Bitcoin’s rally and mentioned a growing interest in crypto among clients worldwide. He described the recent surge as a “flight to quality” amidst global geopolitical tensions.
“I think the rally today [Monday] is about a flight to quality, with all the issues around the Israeli war now and global terrorism.”
— Larry Fink
BlackRock, the largest asset manager globally and a major shareholder in several large Bitcoin miners, has seen significant gains since its IPO in 1999. Fink is not alone in recognizing Bitcoin’s potential; many institutional investors are increasingly interested in the cryptocurrency.
Bitcoin Dominance Reaches Yearly Highs
In addition to outperforming traditional finance assets, Bitcoin’s dominance over the cryptocurrency market has reached new yearly highs at 52.77%, according to the TradingView index (BTC.D).
While Bitcoin appears to be entering a new bull market and showing strength from an investment perspective, caution is advised. Some indicators and bearish experts suggest potential future losses. Investors must be careful not to succumb to FOMO (fear of missing out) and make impulsive decisions in a volatile market.
Hot Take: Bitcoin Outperforms Traditional Finance Assets, Gains Momentum
Bitcoin’s recent rally showcases its resilience and ability to outperform traditional finance assets like stocks and gold. With its strong performance year-to-date and increasing interest from institutional investors, Bitcoin is gaining momentum as a viable investment option.
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