Bitcoin Lost the Best Performing Asset Status to Gold in Q3, But Might Rally in “Most Upside” Q4

  • Fundamentals still strong
  • Institutionalization happening but at a slower pace
  • Ethereum, the only positive top crypto of Q3

Bitcoin, that has been the best performing asset of 2019 and still is, lost the race in Q3 specifically to gold, as per the latest report by Blockforce Capital.

Sept. was the third consecutive month of negative performance that saw the leading cryptocurrency falling 14.4%. As such, the third quarter saw bitcoin down 23.8% while gold emerged as the best performing major asset.

“It has been the 3rd worst quarter since 2012.”

However, things might get better as historically, the 4th quarter provides the “most upside” — averaging 112% return — so there may be a rally into year-end.

Bitcoin volatility during this period also fell to its lowest point, hitting 36% since April 1st.

Fundamentals Still Strong

Bitcoin’s hash rate however, continues to hit new highs, up 55% since the beginning of the year. However, a 40% drop was seen on Sept. 24 that was reportedly due to price fall.

Ethereum hash rate meanwhile, saw seven months of positive growth through August but dropped in Sept.

Bitcoin network transactions declined for the fourth month straight, down 15% from May’s high but still up 20% since the year started. The same trajectory is followed by Ethereum’s network transactions, down 20% since June’s high but increased 20% for the year.

Institutionalization Happening But at a Slower Pace

Q3 has been slow for everyone as trading volumes on the CME were also down but the positive thing was the open interest that remained the same.

The 3rd quarter is reviewed as positive as CME will be listing options in the first quarter of 2020. Interest in options trading has skyrocketed while over $3 billion traded on Deribit in Q3, an increase of 20% q/q.

Although institutionalization is happening, with Bakkt launching with 754 contracts traded from Sept. 23-30, it is slower than expected.

Ethereum, the Only Positive Top Crypto of Q3

During this period, the top 10 coins averaged a loss of 44% with Ethereum being the only top coin to post gains by 4%.

Yearly, Bitcoin is the second-best performing asset with 124% returns trailing after BNB which has been up 160%. However, BNB was down 51% in the quarter but still leads due to its early-year performance.

When it comes to spot volume, the monthly volume on Coinbase is down 58% and Binance 48% from their peak-year-to-date values. This has been the longest stretch of lackluster volume, three sequential months, since the first half of 2018.

Binance’s US exchange launch saw similar results as Bakkt as it traded 610 BTC in the first seven days, in comparison to Bakkt’s 754 BTC.

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