Bitcoin Three Year DCA Outperforms Gold By a Long Shot


Summary
- Investing $10 a day for three years into Bitcoin would’ve yielded a 50.6% upside.
- Investing the same amount in gold would’ve yielded a 27.9% upside.
Despite Bitcoin’s notorious image on Wall Street, dollar-cost averaging (DCA) into Bitcoin would’ve yielded far more attractive returns than investing in gold, reaffirming Bitcoin’s status as one of the best-performing assets.
A 10$ investment daily for three years would constitute a total investment of $10,960. An investment in Bitcoin would’ve appreciated 50.62%, bringing the total value to $16,508. However, the same investment in gold would’ve yielded 27.96%, bringing the overall position value to $14,024.
Dollar-cost averaging allows investors to alleviate some of the risks involved in investing in Bitcoin by minimizing the effects of volatility. Furthermore, throughout the three years, dollar-cost averaging (DCA) into gold would’ve appreciated at a relatively linear pace, while dollar-cost averaging into Bitcoin would’ve been far more volatile.
Is Bitcoin Digital Gold?
Both Bitcoin and gold have seen a surge in interest amid the economic fallout due to coronavirus. With looming concerns over a potential rise in inflation, many investors are looking to alternative assets that act as a hedge against hyperinflation.
Bitcoin specifically has also seen an influx of new institutional money, evident by Grayscale’s Bitcoin Trust, which is setting new highs for assets-under-management. Grayscale alone bought over 18,000 Bitcoins since the Bitcoin halving event last month.
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