Crypto Market VS Traditional Assets. Where do Crypto Markets Stand?

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The size, liquidity, and growth of crypto market are still in its infancy. Even all crypto-related activity is still minimal in comparison to traditional assets.

Global Stock Markets Add More Than 3 Times the Total Value of Crypto Market Assets in a Week

Global stock markets continued to rally in 2019, despite some fears of a correction. Most stocks gained in 2019, with a rally toward the end of the year fueled by the lenient decision of Fed to provide growing liquidity. In just a week, stock markets grew by an amount 10 times higher compared to the market cap of the entire crypto market.

Traditional assets have had centuries in the making, and map out the nominal prices in some of the biggest world economies. Crypto Market assets, on the other hand, are still in a price discovery mode against fiat. There are no certain measures of value that can be tailored to Bitcoin (BTC) or other assets.

2020 Arrives with Optimism for US Stock Markets

For now, the predictions for the US stock market see another year of gains, though tamer in comparison to the gains of the past year. But the data showing the US economy staved off the recession are raising hopes market optimism may continue.

BTC remains an asset with an uncertain relation to the movement of stocks or bonds. For now, only the youngest investor cohorts decide to dedicate some of their portfolios to crypto assets. BTC has entered mainstream trading only through futures trading, but there is still a case for holding onto actual physical coins.

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Investing in crypto-assets can lead to much higher gains in comparison to the stock market. Despite the meteoric rise of some tech stocks in the past decade, BTC remains the fastest-moving asset class, gaining above 65,000%. At the same time, short-term moves mean stock investments are still better when it comes to personal financial security.

BTC still has not received the reserve status of gold, though in the past decade, the coin gained legitimacy. Central banks now pay more attention to the potential of crypto assets, despite their relatively small share of global finance.

The sheer size of the traditional finance market also makes a case for growing BTC inflows in the future. Hyperbitcoinization suggests that the nominal value locked in the finance industry can make extremely high BTC prices a possibility.

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