After Bitcoin (BTC)’s bad start in 2022, Microsoft, Apple and Tesla have also beaten Bitcoin in the past 12 months.
Significant annual return
When it comes to investing, it’s hard to criticize an annual return of 60%. Yet in 2021 Bitcoin holders earned lower returns than one of the Web2 companies trying to overtake crypto: Alphabet (GOOGL).
Bitcoin had a weak December and started the new year with an annual return of 60%. This is the worst performance since 2018, when it lost about three-quarters of its value.
Of course, this is not a bad return, given Bitcoin’s market dominance. Bitcoin has a market cap of $880 billion and ranks eighth on CoinMarketCap’s list of assets, between Meta (FB) and Nvidia (NVDA).
As assets grow, their upward mobility typically decreases. There is more room to grow when you are less accepted. Therefore, newer coins and tokens such as Axie, Solana and Shiba Inu can achieve greater returns.
Tech companies are doing well
Alphabet, which has a market cap above Bitcoin’s, still managed to beat Bitcoin. Google’s parent company saw its share price rise 68% in 2020. It did this thanks to increased advertising revenue on its platforms, including YouTube.
Other top tech stocks also performed well. Nvidia, which makes chips for both video game devices and crypto mining rigs, returned 125%. This is because supply chain problems caused demand and prices for its products to increase. Nvidia’s market cap is now over $750 billion.
Further up the stock list is GameStop (GME), the $11.7 billion video game retailer. In January, the subreddit group WallStreetBets kept stock buying. For example, hedge funds that short GME were overpowered. The stock price rose from about $20 at the start of 2021 to nearly $150 at the end of the year. This is a 687% increase for GameStop.
Returns of other assets against Bitcoin
Thanks to a drop in the first few days of 2022 for Bitcoin, the crypto currency’s gains have fallen to 40% in the past 12 months. This is according to the data from CoinGecko. As a result, some stocks have outperformed last year.
Computer company Microsoft (MSFT) is up 54% last year. Apple (AAPL) has made 41% profit. Electric car maker Tesla (TSLA), led by Dogecoin fanatic Elon Musk, is up 64% in the past 12 months.
Tesla stocks might have done even better had it not been for Musk’s promotion of Bitcoin. The company announced a $1.5 billion Bitcoin purchase in February. In addition, it briefly accepted the crypto currency as a means of payment. Over the following month, however, it saw stock prices plummet from $863 to $563 as Bitcoin rose.
While crypto currencies and companies are different types of assets, comparing the numbers is interesting. Many stocks regularly pay dividends to shareholders. In addition, stocks, even individual stocks, can be withdrawn in retirement accounts. This means they have built-in tax benefits that make them more attractive to retail investors. This is not the case with Bitcoin. For that reason, there is a demand for a BTC ETF that trades like stocks on a traditional exchange.
Bitcoin is known for its wide swings. Joe Weisenthal noted the following today when comparing Bitcoin to Apple:
“In the past year you had to tolerate some pretty big swings to get returns. These returns are not as good as those of the company that makes your phone.”