2019 Was Bitcoin’s “Worst” Positive Year on Record
- January has been the worst month of the year (-14.8%) for BTC over the past 5 years
- BTC theoretical cost basis vs. price graphically 2019 was upward sloping, “a good sign of support and subsequent price increase”
- BitMEX’s BTC funding rate hits the longest streak on record that has resulted in an average 30 days forward performance of -30%
With 9,000,000% gains, Bitcoin is the best asset class of the decade.
In its entire decade long history, 2019 was the worst positive year of the world’s leading cryptocurrency at 85.4%. 2015 edged out with a slight margin, at 88.1%.
Now moving into 2020, while 2011 to 2014 had been four consecutive positive first months for Bitcoin, the last five have been the worst months of the year with an average performance of -14.8%.
The January of 2015, which was six months away from the last halving, BTC recorded a loss of 11.2%.
Currently, we are about 131 days from halving, which saw an average of +45% move during the prior two instances.
If we consider history rhymes, 2018-2021 could be a mirror image of 2014-2017. In 2014, BTC registered a loss of 59.1% and in 2018, we were down 70%. These were the “big sell-offs post-historic up years,” 3,447% uptrend in 2013 and 1,242% rise in 2017. These parabolic rises occurred one year post halving in 2012 (172%) and 2016 (125.6%). Rptr45 tweeted,
15/ If you have a 24 month+ time horizon look to continue to add to $BTC on dips while expecting volatility in 1Q20. Tactically see how Jan plays out given seasonality and lack of vol.
— Rptr45 (@Rptr45) January 2, 2020
What picture could other factors paint?
Now, taking a look at other aspects of the Bitcoin network, Rptr45 notes that the total transaction volume last year fell below both 2017 and 2018 levels at $768bn and $2.1bn respectively.
In terms of inflation, compared to $5.25bn in BTC block rewards mined in 2018 and $2.8bn in 2017, in 2019 it registered at $5.02bn.
This year, the analyst expects to see “some alleviation” post the May halvening. Also, “the market also had to absorb the reported ~200K BTC from PlusToken sales.”
This year also saw a continued breakdown of a relationship between BTC price and transaction count. The average BTC realized cap to market value differential had the lowest year since 2015 as well. The analyst said,
“Looking at BTC theoretical cost basis vs. price graphically 2019 was generally upward sloping which is typically a good sign of support and subsequent price increase.”
December had the lowest high of BTC funding rate on BitMEX since March and the tightest range. It is also in the midst of 11 straight days of an unchanging funding rate at 0.03%, the longest-running streak on record. The performance post these periods had an average of 30 days forward performance of -30%.