Despite there being literally hundreds of thousands of different cryptocurrencies, Bitcoin (BTC +0.84%) remains far and away the market bellwether. It currently accounts for a staggering 60% of the total market cap of the crypto market, and it's typically the first cryptocurrency into any investor's portfolio.
There's a good reason for that: Bitcoin has been the clear market leader in performance over the past decade. If you want to capture the performance of the crypto market, you need to have a position in Bitcoin. Long story short, Bitcoin still looks like crypto's best generational wealth bet, and here's why.
A decade of outperformance
With Bitcoin, it's important to keep your eye on the big picture. Yes, Bitcoin is down a disappointing 40% since October. But over the past decade, Bitcoin has clearly outperformed every major cryptocurrency.
Take a look at this chart comparing the performance of Bitcoin and Ethereum (ETH +1.39%) over the past decade. Ethereum is up a staggering 16,200% during that time period. But Bitcoin is up more than 22,800%.
Bitcoin / U.S. dollar chart by TradingView
It's the same story with other top cryptocurrencies as well. For example, check out this chart comparing Bitcoin and XRP (XRP +0.75%), the world's fourth-largest cryptocurrency.
Bitcoin / U.S. dollar chart by TradingView
Again, it's not even close. XRP is up a staggering 5,500% over the past decade. But that pales in comparison to Bitcoin's 22,800% returns.
What's ahead for Bitcoin?
The big caveat here, though, is that past performance is no guarantee of future performance. In other words, Just because Bitcoin has gone up astronomically over the past decade, it doesn't mean that it will go up astronomically over the next decade.
Image source: Getty Images.
The good news here is that Bitcoin might be able to deliver an encore performance. Exponential growth seems to be built into the Bitcoin algorithm. Just as Bitcoin soared from $100 to $1,000, and then $1,000 to $10,000, and then $10,000 to $100,000, many think it will soar to $1 million from $100,000. In fact, some crypto insiders think Bitcoin might hit the $1 million price level as soon as 2030.
CRYPTO: BTC
Key Data Points
A lot depends on the rate of institutional adoption of Bitcoin. And all signals appear to be flashing green here. Wall Street banks continue to launch new Bitcoin investment products. Financial institutions continue to embrace Bitcoin as a new asset class. And the U.S. government continues to advance new pro-Bitcoin crypto legislation.
Of course, a lot needs to go right between now and then. But, right now, Bitcoin remains the single-best generational wealth bet.
