Who Is the Ten-Year Performance King: Bitcoin, Stocks, or Gold?
Bitcoin arrived more than a decade ago, forming an entirely new market with over 2,000 different digital assets soon joining the market. Since the first crypto started to trade and gain investors’ interest, bitcoin has become the top trading currency by market cap, market share, trading volumes, and price. When compared to the rest of the cryptocurrency market, bitcoin is dominating. However, how well bitcoin has performed over the last decade compared to assets such as stocks and gold? Which asset is the ten-year performance king: bitcoin, stocks, or gold?
Bitcoin Performance over the Last Ten Years
Investing in bitcoin early on, when not many traders and investors considered it a profitable asset, turned out to be a favourable move years later. Long-term investments on bitcoin weigh more than the funds invested in some of the top tech stocks when comparing ten-year metrics. For instance, since bitcoin first appeared in the market, the asset has brought in 9,150,088% in returns over the last ten years. One of the top-trading stocks in the traditional market, Amazon, has brought in 3,156%, followed by Apple stocks gaining 2,345% in ten years. What makes BTC different from these stocks is, among other things, its volatility. Bitcoin has gone through some major lows and highs over the last ten years, trading from as low as $10 per unit to as high as $20,000, the highest price point for BTC. If a trader or investor bought $100 in bitcoin ten years ago and held it until today, that investment portfolio would now be worth $9.2 million.
What is interesting about bitcoin’s performance is that despite all the drops and declines, bitcoin has made the biggest returns compared to all top-trading assets in the traditional stock market. BTC makes up for an astonishing 64% of the market share in the crypto market, having the greatest share of capitalization and the highest price. For comparison, only three stocks in the traditional stock market are trading at prices above $1,000, while BTC has kept the price level between $1,000 and $3,000 for many years now.
There are many similarities between the original crypto and gold, one of the most reliable assets across multiple markets. Many compare bitcoin to gold, forging the status for BTC as ‘digital gold’. BTC and gold are similar in terms of scarcity, security, and lack of centralization. Still, despite the similarities, gold has brought in returns over the last ten years that are over ten times lower than Bitcoin’s.
Gold Performance over the Last Ten Years
Bitcoin is commonly compared to gold, even though gold has been around for much longer and represents a common safe haven in times of recession. During a recession, gold usually rises in value because many investors are looking for a safe way to invest their funds and generate returns for their portfolios. According to historical metrics, the price of gold has always surged when the markets are soaring because gold does not move with market trends. That is why gold is known as one of the most valuable tools for fighting inflation. Bitcoin has been gaining a similar status over the last few years. Countries in inflation are showing increased BTC purchase activity to reduce the effects of the devaluation of national currencies. ago and held it until today, that investment portfolio would now be worth $9.2 million.
Gold saw a ten-year change of 68%. However, what may be interesting is that while gold is outperformed by stocks and bonds on a long-term scale, gold has been winning for the last 15%, listing 278% returns. In 2020, gold is below its record price as recorded in 2011, when the gold price almost reached $2,000 per ounce at one point. Investors usually turn to gold in times of recession, which is how timeframe determines the return on gold investments.
Stock Market Performance over the Last Ten Years
Stock market performance is measured by the S&P 500 Index, which includes the top 500 performers in the stock market. These top spots are reserved for top players in the stock market, such as Microsoft, Apple, and Amazon, which all represent top performers in the last decade. The top player over the last ten years is Amazon with returns of 3,156%, followed by Apple with 2,345%, Visa with 1,597%, and Microsoft with 899%. ago and held it until today, that investment portfolio would now be worth $9.2 million.
The average annual return in the stock market based on the last two decades was 8%. From 2010 to 2020, an average annual return from all top 500 stocks combined was 11%. Despite frequent drops in BTC on more than several occasions and mass selloffs, even the top-trading stocks bring substantially fewer gains to investors than BTC, according to the metrics from the last ten years.
Is Bitcoin the Ten-Year King?
According to Barchart.com, bitcoin gained around 99,999% in ten years with one new high. When it comes to lows, BTC lost 52% of its value, setting new lows 23 times in a decade. Bitcoin outperformed gold and top-trading stocks across all sectors even though bitcoin’s volatility brought numerous lows over the decade, with the crypto sinking from a high of $20,000 in December 2017 to as low as $3,600 less than one year later.
At the same time, BTC is seen as more of a commodity than equity, reacting similarly to gold in times of crisis. Many consider Bitcoin to be the next safe haven for traders and investors due to its decentralization and automated anti-inflation mechanism known as the halving.
Despite the stigma from investors focused on traditional markets that once classified BTC as fraudulent, bitcoin has outperformed all top assets.