PANews January 23 News, according to CoinDesk, CryptoQuant data shows that Bitcoin’s Sharpe ratio has dipped into negative territory, reaching levels seen during market crashes in 2018-2019 and 2022, indicating poor risk-adjusted performance. The current high volatility is not matching weak returns. This indicator measures the ratio of excess return over the risk-free rate to volatility. Turning negative means that the returns from holding Bitcoin are no longer sufficient to compensate for its sharp price fluctuations. Although Bitcoin’s price has fallen from the October 2025 peak of over $120,000 to around $90,000, market volatility remains high.
Historical data suggests that a negative Sharpe ratio can persist for several months after prices stop declining sharply, such as during the long bear markets at the end of 2018 and in 2022. Analysts note that this ratio is not an exact bottom indicator but shows that risk and return have reset to levels seen before major market rallies. The market is usually focused on whether this ratio can sustain a rebound into positive territory, which typically indicates returns surpassing volatility and aligns with the start of a new bull market. Currently, there are no signs of such a trend reversal.
Disclaimer: The information on this page may come from third parties and does not represent the views or opinions of Gate. The content displayed on this page is for reference only and does not constitute any financial, investment, or legal advice. Gate does not guarantee the accuracy or completeness of the information and shall not be liable for any losses arising from the use of this information. Virtual asset investments carry high risks and are subject to significant price volatility. You may lose all of your invested principal. Please fully understand the relevant risks and make prudent decisions based on your own financial situation and risk tolerance. For details, please refer to
Disclaimer.
Related Articles
Missouri Eliminates State Taxes on Bitcoin Capital Gains
Missouri will be the first U.S. state to eliminate state taxes on Bitcoin capital gains, effective January 1, 2025, fostering a pro-crypto environment and attracting investment. This landmark decision may spur competition among states to implement similar tax reliefs.
Coinfomania24m ago
Strategy Acquires 17,994 Bitcoin for $1.28 Billion
Gate News bot message, Strategy (previously MicroStrategy) has purchased 17,994 BTC for $1.28 billion at an average price of $70,946 per Bitcoin. The company now holds 738,731 BTC, acquired for a total of approximately $56.04 billion at an average price of $75,862 per Bitcoin.
GateNews42m ago
Oil prices rise to $119, reaching a new high since 2022, Bitcoin remains at $67,000, and the Federal Reserve has a 99% probability of maintaining interest rates in March.
On March 9th, WTI crude oil prices rose to $119 per barrel, reaching a new high since 2022. Due to threats from Iran, global crude oil supply losses approached 20 million barrels. Bitcoin remained at $67,000, with no signs of panic selling. The probability that the Federal Reserve will keep interest rates unchanged is approximately 99%.
GateNews46m ago
