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Investment Case for Bitcoin Cash

 

Part 1: Introduction to Bitcoin Cash

Part 2: Investment Case for Bitcoin Cash

Part 3: Introducing BCHetc: ETC Group Physical Bitcoin Cash

 

Learn more about our Bitcoin Cash ETC.

Please note that when you trade Bitcoin and Bitcoin Cash ETC's your capital is at risk.

 

While Bitcoin’s use case has changed from its original design as a peer-to-peer cash alternative towards a gold-like store of value, Bitcoin Cash has remained a popular way to spend and transfer digital currency.[1]

Bitcoin Cash’s strength lies in its robust longevity and its consistent development and evolution. It is a peer-to-peer electronic cash systems that supports smart contracts and has a growing community with new projects being developed. 

Bitcoin Cash has achieved what its supporting developers set out to do. That is, to make the blockchain more efficient at scaling and processing payments quickly.

Some of the world’s most talented and forward-thinking programmers remain involved in pushing the Bitcoin Cash network forward.[2]

The BCH subreddit is one of the largest on social media site Reddit, with 604,000 members, and users regularly update these figures on a weekly basis.[3]

 

Performance and Growth Potential

The performance of Bitcoin Cash has been strong against main indices over the past two-year periods (as illustrated in the table below), providing a new source of potential returns. It can be seen as a diversified option for a portfolio that features different cryptocurrencies/digital assets. 

 

1 Month

3 Month

1 Year

2 Year

Bitcoin Cash

21.70%

-5.62%

152.70%

127.42%

Bitcoin

27.25%

31.00%

334.67%

375.03%

S&P 500

3.41%

7.81%

26.70%

55.03%

US Bonds

9.02%

-19.15%

98.16%

-14.21%

Gold

-0.21%

-5.17%

-6.86%

18.33%

Oil

-1.78%

2.67%

57.25%

39.31%

FTSE 100

0.70%

-1.65%

25.15%

12.68%

Eurostoxx

2.84%

1.75%

29.50%

37.99%

Past performance is not a guarantee of future returns. Source: Bloomberg. All data as of 03.09.2021. Please note that all performance figures are showing net data.

 

Correlation and Diversification: 

One argument for a Bitcoin Cash allocation is its low correlation to other widely held asset classes both in periods of market calm and turbulence.

 

S&P 500

US Bonds

Bitcoin Cash

Gold

Oil

EM ccy

FTSE 100


Eurost-oxx

EUR/USD

GBP/ USD

S&P 500

1

0.526

0.239

0.121

0.403

0.344

0.661

0.676

0

0.198

US Bonds

0.526

1

0.129

-0.219

0.298

0.193

0.406

0.365

-0.211

-0.082

Bitcoin Cash

0.239

0.129

1

0.105

0.187

0.06

0.221

0.229

-0.053

0.04

Gold

0.121

-0.219

0.105

1

0.068

0.13

0.064

0.082

0.384

0.308

Oil

0.403

0.298

0.187

0.068

1

0.251

0.401

0.415

0.043

0.204

EM ccy

0.344

0.193

0.06

0.13

0.251

1

0.465

0.483

0.288

0.375

FTSE 100

0.661

0.406

0.221

0.064

0.401

0.465

1

0.912

0.027

0.135

Eurostoxx

0.676

0.365

0.229

0.082

0.415

0.483

0.912

1

0.032

0.251

EUR/ USD

0

-0.211

-0.053

0.384

0.043

0.288

0.027

0.032

1

0.577

GBP/ USD

0.198

-0.082

0.04

0.308

0.204

0.375

0.135

0.251

0.577

1

For illustrative purposes only. Source: Bloomberg. Data as of 03.09.2021. Please note that all performance figures are showing net data.

Summary 

Benefits of Bitcoin Cash

  • High growth potential vs traditional asset classes
  • Low correlation to other asset classes and diversification
  • Potential for improved risk-adjusted returns in a multi-asset portfolio

 

Risks of Bitcoin Cash

  • Bitcoin Cash can be very volatile [4]
  • The price of Bitcoin Cash can go down as well as up and your capital is at risk
  • Past performance is no guarantee of future performance 

 

Watch Bradley Duke, CEO and Co-Founder of ETC Group discuss the recent launch of their Bitcoin Cash ETC:

ETC Group launches fourth crypto offering - a Bitcoin Cash Exchange Traded Product (ETP)

 

 

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