Bitcoin (BTC) scraped the bottom of the barrel in the third quarter of the year, registering a loss of 11.1% for investors, barely beating long-term treasuries, which netted -11.9% over the same timeframe.
Greg Cipolaro, Global Head of Research at Bitcoin firm NYDIG, wrote about the crypto’s poor performance and how it defies recent events in the crypto space.
Cipolaro pointed to favorable court cases, macroeconomic changes, the recent “quagmire” over government funding, the debate on U.S. debt, and the “ongoing efforts to secure approval for a spot Bitcoin ETF,” highlighting how none of these developments managed to push Bitcoin past the upper bound of its current range–which he said sits at $31,000.
Bitcoin, however, wasn’t the only asset to register losses last quarter. In fact, almost every asset class—including gold and other precious metals, the U.S. stock market, and real estate—suffered important percentage drops.
Notably, only four assets celebrated wins in the quarter, with commodities gaining 15.5%, seconded by cash at 1.3%.
Economist for the Heritage Foundation, Peter St. Onge, said a momentary pause in rising prices might be behind Bitcoin’s meager performance. “I think the main driver near-term has been inflation looking more sedate,” he told Decrypt, adding that gold also feels these effects.
This trend might not be long-lived, however. St. Onge pointed out that recent events in Israel might trigger price action in financial assets. “We’ll have to see what happens in the Middle East,” he said, explaining that “hard assets tend to shore up, but risk assets go down.”
For him, “Bitcoin is a bit of both.”
St. Onge’s views differ from those of NYDIG’s global head of research.
Cipolaro sees “persistently” high inflation, rising interest rates, “recession worries,” and seasonality weighed on returns, highlighting that Bitcoin tends to showcase dismal performances in the third quarter of every year. Perhaps in an effort to give investors hope, however, he wrote that the “lackluster performance” has a silver lining: the fourth quarter is historically one of the asset’s best quarters.
In spite of its most recent quarterly performance, Bitcoin investors will have to wait and see if the top cryptocurrency recovers its early 2023 trend, which has seen the asset on fire. Bitcoin has gained 63% on the year, only one of four to register double-digit gains, and is eclipsing its closest contender, U.S. Large Cap Growth Funds by more than double.
This news is republished from another source.
