|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cryptocurrency News Articles
Bitcoin Price Surge In 2024 Not Enough To Beat Gold's Risk-Adjusted Returns – Details Here
Oct 09, 2024 at 07:00 pm
According to Goldman Sachs, Bitcoin (BTC) price appreciation in 2024 failed to compensate for its price volatility risks. Meanwhile, gold's higher risk-adjusted returns reaffirmed its “safe haven” narrative.
Bitcoin (BTC) price performance in 2024 failed to compensate for its price volatility risks, according to Goldman Sachs. Meanwhile, gold’s higher risk-adjusted returns reaffirmed its “safe haven” narrative.
Despite The Gains, Bitcoin Fails To Outshine Gold
The leading digital asset by reported market cap surged from roughly $42,000 at the beginning of the year to as high as $73,000 in March 2024, recording more than 73% gains. At its current market price of $62,790, BTC is still more than 40% up from its price in January 2024.
Notably, throughout 2024, Bitcoin has consistently outperformed major equity indices, fixed-income instruments, gold, and crude oil.
However, despite BTC’s impressive gains, its price performance in absolute terms fails to compensate for its volatility, according to data tracked by Goldman Sachs.
The analysis by Goldman Sachs puts BTC’s year-to-date (YTD) volatility ratio at just under 2%. In comparison, gold gave a risk-adjusted return of 3%, posting strong 28% gains in absolute terms.
For the uninitiated, the volatility ratio measures the return an asset generates for each unit of risk or volatility it carries. A higher ratio indicates that an asset provides better returns relative to the risk taken, while a lower ratio suggests less efficient performance.
The analysis notes that Bitcoin’s volatility ratio was only better than Ethereum’s native ETH token, S&P GSCI Energy Index, and Japan’s TOPIX index among the non-fixed income growth-sensitive investments.
Bitcoin’s low volatility ratio compared to gold cements the latter’s claim as a “safe haven asset.” This came under the limelight last week when BTC slumped, and gold surged following Iran’s offensive against Israel.
Still A Long Way To Go For Bitcoin
Since its inception following the 2008 financial crisis, Bitcoin’s ascent to a trillion-dollar market cap asset has been remarkable.
The fixed supply of 21 million, decentralized network architecture, and halving every four years make BTC an appealing asset. However, the market cap gap between Bitcoin and gold remains vast.
That said, several crypto analysts are confident that Bitcoin will outshine the shining metal in the coming years. For instance, seasoned analyst Peter Brandt recently made an ambitious prediction that by 2025, BTC could see its price jump 400% relative to gold.
Similarly, in August 2024, VanEck CEO Jan van Eck stated that BTC could surge to $350,000 on the back of greater adoption.
Most recently, investment management firm BlackRock declared Bitcoin a “gold alternative” due to its fixed supply and increasing investor confidence in its ability to tackle inflation and avoid value erosion during uncertain times.
On the contrary, billionaire Ray Dalio has expressed his opinion on the Bitcoin vs. gold narrative, saying that BTC will never fully replace gold. BTC trades at $62,790 at press time, down 2.3% in the last 24 hours.
Disclaimer:info@kdj.com
The information provided is not trading advice. kdj.com does not assume any responsibility for any investments made based on the information provided in this article. Cryptocurrencies are highly volatile and it is highly recommended that you invest with caution after thorough research!
If you believe that the content used on this website infringes your copyright, please contact us immediately (info@kdj.com) and we will delete it promptly.
-
- Leading Stablecoin Issuers & Crypto Firms Embrace International Set Of Stablecoin Standards
- Oct 09, 2024 at 10:15 pm
- Stablecoin Standard, the industry body for stablecoin issuers globally, today announced that their recently unveiled set of global standards for stablecoin issuers have been endorsed by some of the leading stablecoin issues and ecosystem participants in the industry.
-
- Bitcoin (BTC) Price Rebounds to $63,000, Attempts to Reclaim Critical Short-Term Holder (STH) Cost Basis
- Oct 09, 2024 at 10:15 pm
- Following a significant 10% price correction, the Bitcoin market has rebounded to the $63,000 level, attempting to reclaim the critical Short-Term Holder (STH) cost basis.
-
- The Next Cryptocurrency to Explode: Identifying the Altcoins Poised for Massive Gains in 2024
- Oct 09, 2024 at 10:15 pm
- The altcoin market looks promising, and many altcoins are recording gains. Bitcoin (BTC) is still struggling to return to its all-time high of $70K, although it managed to surpass 60K. Investors need to stay alert during this consolidation phase, as it could be a chance to catch a ride on a rising trend.
-
- The United Arab Emirates Extends VAT Exemptions to Digital Assets, the IMF Calls for Higher Taxes for BTC Miners
- Oct 09, 2024 at 10:15 pm
- The United Arab Emirates has exempted digital asset holders from paying value-added tax (VAT) on their transactions, extending the same exemptions enjoyed by traditional financial services to the nascent sector.