Markets
Stock Markets Hit New Highs Last Week, But BTC and ETH Suffer
The cryptocurrency industry is often described as a risky asset class that tends to underperform in times of economic uncertainty.
Although the stock market also falls into this category, at least to some extent, it has been on a roll in recent weeks, with several new all-time highs for the most prominent indices. At the same time, crypto has suffered and the biggest digital asset has plummeted since March.
US stock market rising
Maybe driven by the surrounding hype Nvidia, the US stock market has been on a huge bull run since the beginning of the year. Take for example the largest and arguably most prominent index – the S&P 500. It entered 2024 at less than 4,800, but soared to around 5,500 earlier this week to chart a new peak.
The Nasdaq Composite has had an even more impressive performance, rising 19.8% since the start of the year and reaching a peak of its own of nearly 18,000 this week.
However, the Dow Jones Industrial Average, which has little connection to the important technology sector and has no exposure to the better-performing Nvidia, underperformed. Its annual gains are less than 4%, but it still managed to hit a new all-time high earlier this year of around 40,000.
The situation with risky crypto assets like BTC and ETH is quite different, at least in recent weeks.
What about BTC/ETH?
Bitcoin’s year was also quite optimistic, driven by the approval of spot BTC ETFs in the States in January. Although the fourth halving also occurred earlier this year, an event typically considered to be the catalyst for bull runs, the asset has actually underperformed since its conclusion.
ETH saw a regulatory nod from the US SEC as well, as the agency gave the green light to Ethereum ETFs last month. However, they I haven’t released it yet and ETH price lost almost all of the gains that came after the positive news.
As such, both BTC and ETH are down around 10% from their yearly peaks and have separated from the US equity markets. However, it is worth highlighting that although they have decreased in recent weeks, they are still more in the green than the aforementioned indices.
BTC is up 50% since the start of 2024, while ETH has gained 54% over the same period.