Bitcoin still outperformed stocks in Q1 / 2020, despite the worst month since January 2018

Bitcoin (BTC) has just experienced the worst month since its all-time highs two years ago, but the leading cryptocurrency still outperformed the US stock market in the first quarter of 2020.

Markets heavily affected by the global pandemic

Financial markets have suffered big losses due to the Covid-19 pandemic, which forced most countries and industries to close.

The majority of the losses came in March - one of the most forgettable months including Bitcoin. However, since the beginning of the year, the king's coin has still fallen less than the S&P 500 and Dow Jones - two indexes representing the US stock market. Bitcoin also showed some correlation with these two indices as the decline accelerated. Because of this, investors are unsure whether BTC is a reliable safe haven.

In the first three months of the year, Bitcoin dropped by about 10% - from $ 7,200 to the time of writing of $ 6,350. Meanwhile, Dow saw the worst quarter in history, down more than 23%. Elsewhere, the S&P 500 evaporates about 20% - the biggest quarterly loss since 2008.

March 12, 2020 is a nightmare for investors, as the cryptocurrency market loses more than $ 90 billion in market capitalization during the day, while Bitcoin loses nearly 50% of its value to hit a low of $ 3,700. .

However, since then, Bitcoin has recovered more than 70% and its performance has separated from the traditional markets. For many, Bitcoin is still an asset that should be included in the portfolio, especially when the Fed pumps cash into the economy. Vijay Ayyar - CEO of Luno, told CNBC:

“Bitcoin is still a relatively small asset class - which is increasingly unrelated to traditional assets, and this is in the process of being set up as we said. This is why I believe the current market context is a big challenge for Bitcoin, which actually works quite well. ”

Stocks can prolong the decline, what about Bitcoin?

More worrisome is that the stock market has not bottomed out despite the recent rally driven by central banks' pumping of money. The crisis may have just begun, with US President Donald Trump finally acknowledging that the country should be ready for a "very, very painful battle in two weeks". Trump said the United States could see as many as 240,000 people die from Covid-19 even if citizens followed social isolation measures.

JPMorgan asset management firm warned investors that they should not rush to buy stocks because the worst is about to happen. Strategist Hugh Gimber said in an article:

“I am not confident to support positions in high-risk risky assets, because you will be vulnerable in the scenario of decline before news on the medical front. Policy measures have worked, but that is not enough for us to define a clear bottom in this market. ”

For Bitcoin, cryptocurrency analysts have reached consensus on the short-term outlook. However, most investors are confident that cryptocurrencies will return stronger, especially after the halving event.

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