Bitcoin Price Surges Past Crude Oil in 2024

Bitcoin price has done better than traditional assets like crude oil, gold, and even S&P 500 in the year 2024. Bloomberg’s Chief Commodity Strategist, Mike McGlone, attributes this surge to advancing technology, rising geopolitical tensions, and a shift in global commodity dynamics.

Bitcoin Price Outpaces Traditional Assets

Speaking of his X account recently, Mike McGlone posted the updated macroeconomic performance data by Bloomberg Intelligence and pointed to Bitcoin’s outstanding performance in 2024.

Bitcoin price, on the other hand, has risen by 158.9% in the year (125.5% YTD), easily outpacing other major asset classes including gold and the S&P 500.

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Crude oil, on the other hand, has shown steep declines, with expectations for $50 per barrel or even lower, a complete contrast to the Bitcoin rally.

However, McGlone expects Bitcoin’s price to keep on soaring higher because of the continuous advancements of technology in the tech sector.

As such, the rise in cryptocurrency is an indication of increasing demand for digital assets that are enhanced by progress in blockchain technology and the use of DeFi platforms.

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While other assets continue facing challenges, Bitcoin has emerged as the main acceptable form of investment in the volatile market.

Geopolitical Tensions and Commodity Deflation

McGlone also associates BTC’s price with increasing geopolitical risks and declining commodity inflation rates.

The report also highlights how important factors such as the events such as the ongoing Russia-China partnership and global volatilities are perceived by investors.

Thus, there is pressure on traditional, such as crude oil, assets while Bitcoin and other digital currencies are gaining their position as effective stores of value.

Commodity deflation is another critical factor that explains Bitcoin price’s strength. While the price of oil has continued to slide, many commodities are experiencing long-term price declines.

While Bitcoin has a limited supply and is managed through a decentralized network, it sharply differs from traditional commodities such as oil, which tends to be affected by geopolitical factors or supply-demand swings.

Thus, investors are choosing Bitcoin and gold which saw their increased demand when traditional energy investments were under pressure.

Apart from Bitcoin, gold has also risen massively with the price surging to $3,000 in 2024. All of this adds to the rising trend of investors seeking new ways to invest in commodities other than oil.

McGlone points to the interconnected nature of these global changes, suggesting that as geopolitical risks rise and traditional commodity markets weaken, assets that can offer security and growth like Bitcoin and gold are becoming increasingly attractive.

Gold and S&P 500: Strong Performers in 2024

Apart from Bitcoin’s bull run, gold has also been on the surge. Gold has been by 33.8% in the past year and is up 27.4% for the year so far. In addition, the S&P 500 has also surged as it has benefited from the general increase in the tech-driven economy.

However, McGlone notes that the index’s performance is not as pronounced as that of Bitcoin, which has far outpaced traditional stocks. The rise of tech stocks within the S&P 500 is part of a broader trend in which technology and digital assets are redefining the investment landscape.

The movement of Bitcoin, gold, and S&P 500 highlights the overall demographic change in stock market investments. This diversification is evident in the growing popularity of digital assets, with Bitcoin leading the charge in 2024.