Bitwise Chief Investment Officer: Bitcoin's Extraordinary Resilience
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Bitwise Chief Investment Officer: Bitcoin's Extraordinary Resilience
This could be the first time in history that Bitcoin outperformed the stock market during a global market correction.
Navigating Web3 tides with focused insightsAuthor: Matt Hougan, Chief Investment Officer at Bitwise
Translation: Luffy, Foresight News
Have you noticed this astonishing fact: over the past month, Bitcoin's price has barely moved at all.
As I write this memo, Bitcoin is trading at $84,379; a month ago, it was priced at $84,317. That translates to a return of just 0.07% over 30 days.
The crypto market has faced massive shocks from all directions—from the U.S. establishing a strategic Bitcoin reserve to President Trump imposing global tariffs—yet Bitcoin’s price has remained flat.
Thinking about all the time, energy, and anxiety I’ve poured into analyzing the market over the past 30 days, I could almost cry.
Yet on the other hand, I find Bitcoin’s recent performance impressive. The U.S. stock market peaked on February 19 and has since fallen by 12.0%. Over the same period, Bitcoin dropped by 12.4%. This is markedly different from previous market corrections.
The last time the stock market entered a correction phase was in 2022, between January 3 and October 12, when the S&P 500 declined by 24.5%. During that stretch, Bitcoin fell by 58.3%.
Prior to that, during the early stages of the pandemic in 2020, the S&P 500 plunged 33.8%... while Bitcoin dropped 38.1%.
Going further back, at the end of 2018 amid escalating U.S.-China trade tensions, equities slid 19.36%, while Bitcoin fell 37.22%.
In fact, since Bitcoin first surpassed $1 in 2011, it has never outperformed the stock market during any market downturn. But this time, I believe we might see an exception.
Critics will point out that merely matching stocks during a downturn doesn’t make Bitcoin a true hedge—and indeed, gold performed better than Bitcoin during this pullback. That’s true.
Others may note that the stock market may not have bottomed yet, or that it has slightly rebounded over the past few days.
Nevertheless, one key point remains undeniable: Bitcoin now appears remarkably resilient. Amid global turmoil, it continues to trade above $80,000. If that doesn't convince you of its staying power, then I don't know what will.
Bitcoin Is Maturing Before Our Eyes
You might ask: why is this happening? I believe it’s a sign of Bitcoin maturing.
What makes Bitcoin unique is that its returns are driven by two forces—sometimes opposing each other.
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Risk asset: On one hand, Bitcoin is a risk asset—an emerging, technology-driven investment that historically delivered high returns alongside high volatility.
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Hedge asset: On the other hand, Bitcoin can act like gold, serving as a hedge against macroeconomic mismanagement and fiat currency depreciation.
In Bitcoin’s early days, the "risk asset" characteristic dominated. Back then, its success was uncertain, so during risk-off periods, it suffered severely—declining more sharply than stocks.
Today, as more corporations and institutions buy Bitcoin, and as more governments hold it as strategic reserves, its role as a "hedge asset" is becoming increasingly evident. Investors now view it as digital gold. The result is a lower beta relative to equities during market sell-offs.
I can't guarantee this relationship will persist indefinitely, nor can I say for sure that the remarkable resilience we've recently seen in Bitcoin will continue. But so far, the outlook looks quite promising.
Bitcoin is evolving into a macro asset—and that is undoubtedly reassuring.
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