Bloomberg: Bitcoin missed a good opportunity to prove itself in economic turmoil

According to Bitpush data, for quite a long time, Bitcoin, the cryptocurrency with the highest market value, has been fluctuating in the range of US$9,000 to US$10,000. Bloomberg editor Joe Weisenthal believes that Bitcoin has failed to rise amid the economic turmoil and missed a good opportunity to prove itself as "digital gold."

Although the price of Bitcoin has risen significantly compared to the beginning of the year, the article still lists six reasons why Bitcoin's performance this year has been disappointing.

First, despite the global market turmoil in the past few months, the price of Bitcoin has not reached new highs, and has not even been able to consistently break through $10,000. The highs of each Bitcoin rally are trending downward, which refutes the view that economic crises can bring prosperity to Bitcoin.

Second, far from rising sharply, the price of Bitcoin has actually moved in much the same direction as the S&P 500. From its early-year rally to its mid-March crash, and then its subsequent rebound and fall, this correlation with the stock market undermines the argument that Bitcoin can provide uncorrelated benefits to a portfolio.

Third, Bitcoin’s performance this year is close to that of Ethereum, the second-largest cryptocurrency by market value, and is even weaker than some other cryptocurrencies. This also means that it should not be dubbed “digital gold,” which would stand out from other cryptocurrencies in a crisis.

Some other evidence cited by Weisenthal include that the halving of Bitcoin block rewards in May this year did not affect the price of Bitcoin, the inflation caused by the Federal Reserve's quantitative easing and economic stimulus measures did not come, and more young people are investing in the stock market through platforms such as Robinhood.

In summary, he believes that although the crisis at the beginning of this year may ultimately still be beneficial to Bitcoin, such as in terms of privacy protection and digital payments, some debates about the value of Bitcoin itself can come to an end.

Although Weisenthal is not optimistic about Bitcoin, Bloomberg has previously released a series of reports saying that "Bitcoin is maturing at an accelerated pace" and that 2020 will be "a key year for Bitcoin to become digital gold."

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AuthorLiang Che

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