Most investors expect 1) blockchain assets to be riskier than technology stocks and 2) there is a long-term correlation between blockchain assets and risk-on assets
Basis Comparison
This chart from Markets Insider peaked my curiosity
I thought it would make sense to add more benchmarks to get a more complete picture:
- ARKK: Ark Innovation ETF
- IXIC: NASDAQ index
- BRK-A: Berkshire Hathaway
- VOOV: value stock index
- SPY: S&P 500 index
- CCI-30: top 30 blockchain assets ("rat poison squared" according to Mr. Buffet)
What was already apparent was that blockchain assets seriously outperformed both value and technology stocks in the period analyzed by Markets Insider. So I decided to dig in deeper to make sure I was not arbitrarily picking a period which skewed the results.
Detailed Comparison
Even in a risk-off environment, CCI-30 outperformed
Expected
Expected
This is the only timeframe where "rat poison squared" underperformed Mr. Buffett
This starts at the beginning of the 2018 blockchain bear market
Expected
Expected
Expected
In aggressive market movements, correlations between assets can rise for a short period of time. To the untrained eye, all risk assets should be underperforming right now and wiping away the gains they enjoyed over the last few years. But when there are a separate set of fundamentals driving the value of different assets over the long run, you can end up with massive differences in performance.