Year-to-Date, Bitcoin Outperformed 3 National Currencies Despite Major Correction


Bitcoin, the most dominant cryptocurrency in the global market, has still managed to outperform three national currencies year-to-date despite its steep decline since December of last year.Charlie Bilello, the director of research at Pension Partners, a New York-based investment advisory which manages mutual funds and separate accounts, published a chart comparing the returns of cryptocurrencies and reserve currencies that revealed Bitcoin has outperformed the Venezuelan bolivar, Sudanese pound, and Argentine peso. 

Third Worst Correction of Bitcoin

Bitcoin and the rest of the cryptocurrency market have experienced their third worst correction in 2018, subsequent to their major drops in 2012 and 2014. Still, Bitcoin along with VeChain and EOS have outperformed many reserve currencies over the past nine months, especially those that were largely affected by US sanctions.

The Turkish lira fell by more than 50 percent since last year, recording a 44 percent loss against the US dollar after the US government tightened its sanctions against Turkey by excluding the region from the global financial system.

The Argentine peso and the Venezuelan bolivar massive declined in value due to hyperinflation, and for the residents of Venezuela, the drop of the bolivar was intensified to unprecedented levels after the country’s president Nicolas Maduro officially announced his controversial decision to effectively replace the national currency with a state-backed cryptocurrency called Petro.

Throughout the past nine years, as Coinbase CTO Balaji Srinivasan stated at TechCrunch Sessions: Zug, the cryptocurrency market has experienced a clear pattern of bubble-crash-build-rally.

Developers like Ethereum creator Joseph Lubin and Gnosis founder Martin Koppelman have said that price of cryptocurrencies is the least interesting element of the market as it will follow positive developments that are made in the cryptocurrency sector in the long run.

But, while a long-term recovery is generally expected by the vast majority of investors and analysts in the market, the same cannot be said for certain national currencies that have performed poorly for many years.

Crucially, eToro CEO Yoni Assia said in an interview with NewsBTC that the demand for Bitcoin has not fallen since early 2018, possibly due to the entrance of institutional investors into the cryptocurrency market. He said:

“In our view, the recent market correction is good for the long-term development of the market. Cryptoassets are still a relatively nascent market; emerging technologies like this often see swings in their value in the early days. Market adjustments like those we have experienced recently help to stabilize prices, and make the industry more robust. Despite these adjustments, however, we have not seen a significant dip in demand for digital assets.”

Stabilization of Bitcoin

Bitcoin saw its most stable month in August in a 14-month period, demonstrating newly found stability which analysts argued was created by the involvement of large-scale investors and institutions in the market.

The lack of correlation between Bitcoin and the broader financial market is expected to increase the demand from institutions for cryptocurrencies as an emerging asset class, which may allow cryptocurrencies to continue to outperform national currencies in the years to come.

The post Year-to-Date, Bitcoin Outperformed 3 National Currencies Despite Major Correction appeared first on NewsBTC.

 

 

Source: Crypto New Media

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