Bitcoin (BTC), having closed 2021 with 66.5% beneficial properties in complete returns, has been the very best performing asset class for the third yr in a row. Bitcoin outperformed 16 different asset lessons together with age-old funding automobiles like gold, commodities, and U.S. treasuries and bonds.
The information, which was highlighted by the founder and CEO of Compound Capital Advisors, Charlie Bilello, confirmed that Bitcoin has carried out spectacularly nicely within the final decade.
Bitcoin’s efficiency towards rivals is unmatched
In keeping with the chart, Bitcoin was adopted by commodities, which had a 41.4% return in 2021. US Actual Property Funding Trusts (REITS) clocked in because the third-best performing asset by returns with a return of 40.5%.
Gold, the opposite main inflation hedge asset that Bitcoin continues to be in comparison with, ranked in sixteenth place in complete returns with a detrimental complete return of 4.1%, solely performing higher than Lengthy Period Treasuries, which recorded a 4.6% return in 2021.
The final three years haven’t been the one years the place Bitcoin dominated different asset lessons. Bitcoin has been the very best performing asset in 9 out of the final 11 years, solely being outperformed by US REITS and U.S. Money in 2014 and 2018 respectively. Nonetheless, on this timeframe, Bitcoin has nonetheless been the very best performing asset, having amassed a cumulative complete return of over 1 million p.c, and an annualized complete return of 197.2%.
The forecast for Bitcoin in 2022
Whereas Bitcoin didn’t attain the $100,000 goal most analysts predicted for 2021 because of persisting market volatility, many market members are nonetheless extremely bullish for the benchmark cryptocurrency in 2022.
A number of catalysts are anticipated to push Bitcoin’s value to new highs this yr. One in all these is the anticipated approval of a Bitcoin spot exchange-traded fund (ETF). The SEC spent final yr suspending choices on and denying a number of Bitcoin spot ETFs, however market members anticipate that they may not have the ability to stall an approval in 2022.
Moreover, there may be excessive anticipation that extra nation-states and institutional buyers will undertake Bitcoin this yr. The president of El Salvador, Nayib Bukele, has predicted that this yr two extra nations will be a part of his nation in adopting Bitcoin as authorized tender. This adoption can even drive the value of Bitcoin to $100,000 in line with the president’s prediction.
The alarming inflation price, which is presently at 6.2% within the US, can also be very bullish for Bitcoin in line with analysts. From our current report, Antoni Trenchev, the founding father of crypto lending platform, Nexo, predicted that Bitcoin would attain a value of $100,000 by the center of 2022. For Trenchev, the Fed’s transfer to introduce a price hike to battle inflation would solely trigger a dip within the inventory market that will drive the value of Bitcoin up.
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