Averaging Bitcoin (BTC) dollar costs over a year is an opportunity that investors cannot “ignore”., thinks one of the best-known price analysts in the industry.
In one Debate on twitter on June 3rd Plan B, Creator of the popular Bitcoin Stock to Flow pricing model, He said the Dollar Cost Average (DCA) could easily achieve 70% profitability in the short term.
“Investors can’t ignore that”
His example was about a three-year process. A slow increase in investment on a sliding scale until 2017, waiting for 2018 as a whole, and then applying the opposite process until 2019 would have resulted in a 70% return.
“”Investors cannot ignore this“, summarized.
When asked whether it was important when an investor started the process, PlanB said so Due to Bitcoin’s overall historical performance, the chances of winning hardly decreased.
“It doesn’t really matter because the (historical) chances are 9 to 1 that you get a positive return,” he added.
DCA Bitcoin ROI chart. Source: PlanB / Twitter
Square leads the DCA race
DCA refers to the purchase of small amounts of an asset over time. The aim of this investment strategy is to avoid market fluctuations, a phenomenon that attracts attention in Bitcoin. March was the most volatile month for the BTC price since January 2014, according to a monitoring resource.
There are already signs in the broad Bitcoin industry this year that investors know they can’t ignore the idea.
Cointelegraph reported last month This payment company Square has released DCA purchases of Bitcoin for users. At that time, the numbers from the dedicated computing resource were dcaBTC suggested that a $ 10 weekly purchase would have made a 65% profit over the past three years.
Alternative deadlines also deliver attractive results. Bitcoin’s quarterly returns were over 50% in the second quarter alone, slightly exceeding 7.2% of gold and 20.8% of SP 500.
So far, with a return of 34%, Bitcoin has been the macro asset with the best performance.
Comparison of returns on macro assets in 2020. Source: Skew
Despite this, The total investment volume remains low compared to established asset classes;; However, a report this week argued that if the current growth rate continues, Bitcoin will soon challenge the competition.