First Mover: You Call That a Record? Bitcoins November Gains Are 3x Stock Markets

Tuesday 01 December 2020, 2:08 AM AEST - 1 month ago

moshed-2020-11-30-8-37-44As stock-market prices climb ever higher, bitcoin is towering above them, and proving resilient.

Bitcoin was higher, appearing to mount a fresh run toward the all-time-high near $20,000. The largest cryptocurrency slid 1.3% in the seven days through Sunday, snapping a seven-week winning streak.

As November draws to a close, bitcoin is up 37% just this month, its best performance since May 2019.

Even if the market has some froth, bitcoin fundamentals look sound, the blockchain research firm Chainalysis wrote in a report.

In traditional markets, European shares were steady and U.S. stock futures pointed to a lower open as investors turned cautious after big gains over the past few weeks boosted coronavirus-vaccine developments.

From a broad 2020 perspective, its hardly news that bitcoin in November once again outperformed the worlds major asset classes.

During a month when a closely tracked gauge of global equities, the MSCI World Index, surged 13% for its best performance on record, bitcoin jumped nearly three times as fast.

But thats been happening a lot recently, with the cryptocurrency up an astounding 163% so far in 2020, or roughly 13 times the 13% year-to-date gains for U.S. stocks. Gold is up 17% in 2020.

Yet in hindsight, November may prove to be a crucial month for bitcoin for a few key reasons.

First, in a theme that First Mover has repeatedly hammered this year, many large institutional investors are herd followers, driven by backward-looking performance track records, and they often just ape other investors who have previously performed well. The latest announcement of institutional adoption – perhaps the buzziest of buzzwords these days among cryptocurrency analysts – arrived over the weekend from the $233 billion investment firm Guggenheim. Novembers outperformance, coupled with a raft of breathless headlines ...

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