Bitcoin and other digital currencies outperformed traditional assets by 20 times in the second quarter, according to a report released Wednesday by CoinDesk.
In the second quarter, Bitcoin returned 150.6% year over year, the report found, and returns for all digital assets were 445%. Global equities returned nearly 15%, followed by U.S. equities at 9.2%, gold at 7.75% and global real estate at 3.2%.
“Blockchain and digital assets are already solving real-world problems in business, government, technology and finance, and its impact on markets has been extraordinary,” Nolan Bauerle, director of research for CoinDesk, said in a statement. “At the end of Q1, the total cryptocurrency market cap was valued at $23 billion USD, and largely due to [initial coin offerings], the total market cap for digital assets hit $109 billion USD by the end of Q2.”
In a survey of more than 1,300 blockchain investors, 57% reported a positive outlook for Bitcoin, up 8% over last quarter. Although investors were distinctly more optimistic about Ethereum (65% reported a positive outlook), that’s down 29% from Q1.
The report examines the time period before Bitcoin split in August. After the Aug. 1 fork that split the leading cryptocurrency into Bitcoin and Bitcoin Cash, the original token fell to below $2,700 before recovering to over $3,110 by Aug. 5. Bitcoin was trading at over $4,655 on Sept. 7. Bitcoin Cash peaked at $996.92 on Aug. 19, and was trading at over $653 on Sept. 7.
Investors are concerned that mining for Ethereum and, to a greater extent, Bitcoin are too centralized. Over 71% of investors said Bitcoin mining was too centralized, with over half anticipating increased centralization in the future. The report found 46% of investors agreed Ether mining was too centralized; almost the same percentage (44.7%) expect it to become more so.
Furthermore, 58% of investors expressed concern that digital asset valuations are in a bubble. The report found combined valuations for public tokens hit a record $100 billion in the second quarter, far above the previous high of $25 billion.
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