By Larry Wright
Bitcoin has recently crossed the $28K threshold, with a chance to increase more traction in the coming days. The recent traction around Bitcoin has resulted from the perceived uncertainty of the traditional banking system.
Therefore, the cryptocurrency market is currently on its way to regaining the lost momentum during the lengthy crypto winters. As per the Year-to-Date metric, Bitcoin has emerged as the top-performing asset in addition to being the best risk-adjusted output.
Therefore, Bitcoin has raced ahead of traditional banking assets and projects in addition to traditional commodities such as gold. These remarks are not the general observation of cryptocurrency investors but also reported in the latest edition of the analysis issued by Goldman Sachs.
The analysts at the firm have noticed that Bitcoin has outrun all the other traditional investment options, such as real estate, gold, and securities trading on the YTD scale.
Goldman Sachs has shared a new report that has compared the performance of Bitcoin with other investment options. The report noted that on the YTD scale, tech companies rallied by positive 16%, while enterprises based on communication services gained 15%, the consumer privacy market generated 11% returns, Russell 100 index improved by 10%, gold yields stayed at 4%, and the S&P 500 was appreciated by 4%.
However, Bitcoin returns have remained more generous in comparison to all these investment options.
The report also took note of the energy and oil sectors that suffered from losses of 11 and 14 percent, respectively. Oil prices dipped to the lowest level since December 2021. Goldman Sachs has pointed out that the drop in oil prices is caused by the declining strength of fundamentals and increasing market concerns on account of shortage and quality control issues.
The firm noted that in the future, the market is going to depend on OPEC and the US reserves to make up for the losses. In terms of risk-adjusted returns, Bitcoin has shown a score of 1.9 in terms of the Sharp Ratio.
The Risk-Adjusted Returns for Bitcoin are Better than Health Care, Information Technology and NASDAQ
The report by Goldman Sachs has noted that Bitcoin’s positive performance is the direct result of the monetary policies of the US government. It also pointed out that since the regulatory crackdown on SVB, Bitcoin prices have appreciated by 35% since March 10.
During the environment of chaos and uncertainty Bitcoin, price rebounds have been faster in comparison to Wall Street. At the same time, the bellwether currency has also managed to absorb the shock waves generated by FTX, Terra, and Celsis 3AC.
The aftermath of the recent banking crisis has enabled investors to view Bitcoin in a new light. However, financial experts were notified that Bitcoin prices are still affected by the inflation rates and the monetary policies of the Federal Reserve.