Bitcoin is currently trading around $7,000, representing a 94% gain on a year-to-date basis, according to CoinDesk’s Bitcoin Price Index. Bitcoin is well on track to significantly outperform traditional assets like gold and stocks in 2019.
Prices rose from $3,700 to $13,880 in the first 6 months but ended the rise in the 3rd and quarter and the sell-off was accentuated in the final 4th quarter. Bitcoin is reporting a 48% loss from the high of $13,880 seen at the end of June. Despite the 2nd half downturn, Bitcoin’s full-year performance is positive and the cryptocurrency is outperforming gold and S&P 500 big times.
Gold is up 15 percent on a year-to-date basis. Meanwhile, the S&P 500 index is currently reporting a 28% gain for 2019. That its the biggest yearly gain since 1997. Both assets likely benefitted from the U.S. Federal Reserve monetary easing. The central bank delivered three 25-basis-point interest rate cuts in the second half and has expanded its balance sheet by more than $300 billion since mid-September.
While Bitcoin’s 94% yearly gain looks staggering when compared to traditional markets, the number looks slightly less impressive if we take into account the cryptocurrency’s historical performance.
Bitcoin showed impressive gains in 6 years between 2011 and 2019. Bitcoin rallied most, by a staggering 5,428% and 1,336% in 2013 and 2017, respectively. Further, it gained 189% in 2012 and 124% in 2016. This year’s 93% yearly gain is actually the second-lowest on record, with the lowest rise of 34% being registered in 2015.
Sven Franssen