Despite the stock market being at all-time highs and Bitcoin (BTC) losing just under half of its value since July, Bitcoin (BTC) is still the top-performing asset class of 2019 by far with a gain of 90% as the year comes to a close.
In comparison, the Dow Jones Industrial Average (DJIA) is up 20% this year, with the S&P 500 up 26% and the NASDAQ up 30%.
Meanwhile, gold is up 20%, despite the general consensus across financial news being that investors prefer gold as a safe haven versus Bitcoin (BTC). This may be true in terms of total capital invested into gold since the gold market is much bigger than the crypto market, but gold has not beaten the stock market this year and remains capped below long term resistance levels.
Bonds are perhaps the most popular safe-haven asset but United States Treasury Bond rates are now below 2% per year, which does not even outpace USD inflation which is around 2% according to Consumer Price Index (CPI) data.
It is also important to note that Bitcoin (BTC) has outperformed altcoins, with the Bitwise 10 index of the top 10 cryptocurrencies by market cap only rising 50% in 2019. This beats the stock market by far but pales in comparison to Bitcoin’s (BTC) gains of 90% during the same period.
It seems crypto has a major advantage over other asset classes due to its relatively low liquidity and market cap compared to stocks and precious metals. Even a small fraction of global capital being invested into Bitcoin (BTC) and other cryptocurrencies can cause massive price increases throughout the crypto market.
The side-effect of the low liquidity and market cap of the crypto space is high volatility, but long term crypto — especially Bitcoin (BTC) — continues to pan out better than other asset classes.