Both bitcoin and gold have been popular with investors looking for an alternative to US dollars. Photo: iStock

Bitcoin has outperformed gold in terms of returns by such a large extent over the past decade that many investors are unconcerned about recent price declines.

Data from monitoring resource Blockchain show that since 2010, bitcoin has delivered profits of almost 9 million percent, William Suberg reported on Cointelegraph.

Putting it a different way, $1 invested in the leading crypto 10 years ago was worth around $90,000 as of December 18. By comparison, $1 of gold is now worth $1.34.

Visibly buoyed by bitcoin’s performance, Barry Silbert, CEO of cryptocurrency investment conglomerate Digital Currency Group, deployed the popular Twitter hashtag #dropgold, with his post subsequently receiving over 1,600 retweets.

The statistics underscore bitcoin as a winning investment for the vast majority of its existence. As information portal 99 Bitcoins confirmed on Thursday, since 2009, Bitcoin has only been unprofitable to buy on 434 days – at price peaks.

This equates to 89.16% profitability, allowing bitcoin to put pay to gold’s record despite the precious metal’s own recent advances in US dollar terms.

Year-on-year, Bitcoin returns have been similarly impressive. At current price levels around $7,150, Bitcoin investors made 85% profits versus December 2018.

With 2017 as an exception, they remain in the green every year since the beginning.

As Cointelegraph reported, a recent analysis of wallets has shown that bitcoin “hodlers” have in fact remained highly disciplined in 2019, despite this year producing a bull-run from lows of $3,100 to almost $14,000.

The phenomenon supports the perception of bitcoin as an investment tool, suitable for savers with a low time preference who wish to preserve wealth for the long term.

As Saifedean Ammous summarized in his popular book, The Bitcoin Standard, that characteristic will continue to pit bitcoin directly against “easy” forms of money, including fiat currency.

Over the New Year period, the US Federal Reserve alone will add an extra $425 billion in fiat value to the economy – more than three times bitcoin’s market cap – that is essentially money created out of thin air.

But is bitcoin the best investment in 2020?

One former crypto skeptic-turned bitcoin believer has predicted that the price of the leading digital asset could hit $100,000 over the next two years before climbing as high as $500,000 by 2030, Billy Bambrough wrote in Forbes.

“Between now and 2021, we’re likely to see $100,000 bitcoin,” Mark Yusko, the chief executive and chief investment officer at Morgan Creek Capital Management, told business news outlet Business Insider.

“By 2025, we’re likely to see $250,000 bitcoin, and then some time out, 2030, we could see $400,000 or $500,000 bitcoin as it reaches gold equivalence.”

Leave a comment

Your email address will not be published.