Even compared to the darling of the stock market in the 2000s, Amazon's risk-reward performance of Bitcoin (BTC) still looks like a strange beast.
This is the conclusion of one of the most famous analysts in the cryptocurrency industry and the creator of a particularly accurate Bitcoin price model.
PlanB: Compared to BTC, Amazon's performance can only be said to be "normal"
On January 24th, PlanB uploaded a chart showing the relationship between BTC risk returns and Amazon stocks, US bonds, gold and the S & P 500 index, showing that Bitcoin behaves completely differently as an investment.
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In 2000, Amazon suffered a huge loss, and even after its prestigious recovery, it is still far below the risk-reward ratio of Bitcoin.
PlanB concluded: "Bitcoin … is a strange beast!"
He described Amazon on the chart as "closer to normal."
Amazon's recent share price appears to have shrugged off news of Saudi Arabia's alleged invasion of CEO Jeff Bezos this week. Nonetheless, both Amazon stock prices and BTC have fallen over the past 7 days, with the latter likely to respond to uncertainty from China.
Bitcoin Risk Returns and Major Investments. Source: PlanB / Twitter
An unstable winning bet
An impressive comparison took place a few days ago, and Cointelegraph reports that based on a four-year investment, Bitcoin's risk-adjusted returns exceed all major investment products.
Then, PlanB seems to suggest that a four-year period (each time to reduce the interval between new Bitcoin supply, that is, to halve the interval) may continue to improve Bitcoin performance.
In addition, cryptographer Nick Szabo added that traditional tools are susceptible to government and central bank intervention in currency markets, which means that Bitcoin is well suited for long-term or low-priority investors.
PlanB's price model (from inventory to circulation, stock-to-flow) correctly reflects the historical behavior of Bitcoin and continues to predict that the price of BTC / USD will reach $ 100,000 in 2021.
At the current level, the market continues to comply with the stock-to-flow law, and the current transaction price is $ 8,300, which is slightly below the recommended range. In fact, until the next halving in May of this year, $ 8,300 is the average price that the model says Bitcoin will trade before it rises sharply.