Bitcoin and Ethereum Outperform Traditional Markets in 2023, According to Glassnode
A recent report from Glassnode, an on-chain analytics firm, highlights the impressive performance of Bitcoin (BTC) and Ethereum (ETH) compared to traditional markets this year. The report reveals that Bitcoin has appreciated by 93% against gold in 2023. When priced in gold, Bitcoin is currently trading at its highest levels since September 2021. This data showcases Bitcoin’s potential as a hedge against inflation and economic uncertainty.
Ethereum has also outperformed gold significantly this year, with a 39% appreciation against the precious metal. Glassnode points out that ETH and BTC returns have been closely correlated on a rolling 30-day basis in 2023, experiencing similar magnitude drawdowns. However, Bitcoin has shown stronger performance during uptrends.
Shallow Corrections and Growing Investor Support for Bitcoin and Ethereum
Both Bitcoin and Ethereum have experienced relatively shallow corrections compared to previous crypto cycles. Glassnode highlights that Bitcoin’s maximum drawdown in 2023 has only been 20.1%, much lower than the over 60% corrections seen in past bull markets. Similarly, Ethereum’s deepest drawdown against the US dollar has been 44%, also less severe than previous market cycles.
This data suggests that there is growing investor support and positive capital inflows into both Bitcoin and Ethereum this cycle. These coins are not experiencing the same extreme volatility and selling pressure as in the past.
Bitcoin Dominance Continues to Increase
Despite the rally of altcoins against the dollar recently, Glassnode notes that Bitcoin dominance continues to increase in 2023. The market capitalization of Bitcoin has grown by 110% year-to-date, while the altcoin market cap (excluding stablecoins) has only increased by 37%. Bitcoin remains the clear leader in terms of capital rotation between digital assets.
Hot Take: Bitcoin and Ethereum Showcase Resilience in 2023
The strong performance of Bitcoin and Ethereum against traditional markets, as highlighted by Glassnode’s report, demonstrates their resilience and growing investor support in 2023. Both cryptocurrencies have outperformed gold, with Bitcoin serving as a hedge against inflation and economic uncertainty. Moreover, the relatively shallow corrections experienced by Bitcoin and Ethereum indicate reduced volatility compared to previous market cycles. Despite the recent rally of altcoins, Bitcoin continues to dominate the crypto market in terms of capital rotation. Overall, this data suggests that Bitcoin and Ethereum are solid investments that have proven their strength in the current market climate.
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