Bitcoin’s CAGR Declines to Record Low of 8% Amidst Market Changes

Cryptonews BITCOIN, COINDESK, CRYPTOCURRENCY, ETHEREUM, GLASSNODE, MARKET ANALYSIS, MARKET TRENDS, TRADING ACTIVITY Sophia Klein March 12, 2025

Bitcoin’s CAGR Declines to Record Low of 8% Amidst Market Changes

Bitcoin’s four-year CAGR has fallen to a record low of 8%, reflecting decreasing volatility as the asset matures. Ethereum has also seen a decline against Bitcoin, with its ETH/BTC ratio now at 6%. This analysis underscores changing dynamics in the cryptocurrency market.

Recent data from Glassnode indicates that Bitcoin’s four-year compound annual growth rate (CAGR) has reached an unprecedented low of 8%. This four-year interval was selected to reflect Bitcoin’s halving cycle and the typical bull and bear market fluctuations that occur over a similar duration. As of March 2021, the price of Bitcoin was approximately $60,000, which was close to the peak of the prior market cycle.

The reduction in CAGR aligns with the understanding that Bitcoin’s returns and volatility are expected to decrease as the asset matures over time. It is important to note that this metric is influenced by its reference points. While Bitcoin was experiencing a peak in early 2021, it is posited that in March 2025, a price of $80,000 may represent a market bottom.

Additionally, the ETH/BTC ratio for Ethereum has also entered into negative CAGR territory, reported at 6%. This decline highlights Ethereum’s underperformance relative to Bitcoin, attributable to Ethereum’s price remaining largely stagnant since February 2021 and dipping below $2,000. The current ETH/BTC ratio is recorded at 0.024, the lowest since late 2020.

In summary, Bitcoin’s CAGR has diminished to 8%, highlighting a trend of decreasing volatility and returns as the asset matures. The metrics are closely tied to specific price points during market cycles. Furthermore, Ethereum’s performance relative to Bitcoin has declined, as evidenced by the negative CAGR in the ETH/BTC ratio. These trends indicate significant shifts within the cryptocurrency market.

Original Source: www.tradingview.com