LIVE MARKETS-Bitcoin's dull year may signal market maturity, Bernstein says
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BITCOIN'S DULL YEAR MAY SIGNAL MARKET MATURITY, BERNSTEIN SAYS
The lackluster performance of bitcoin this year could actually be a sign that the asset class is maturing, according to analysts at longtime crypto bull Bernstein.
While the biggest crypto token BTC= has dropped 27% so far this year, Bernstein argues the decline says more about where investors are directing their attention than about bitcoin's long-term prospects.
Retail traders who once drove crypto booms have instead flocked to artificial intelligence-linked stocks, leaving bitcoin largely on the sidelines.
"Bitcoin being boring this cycle should not be held against it and does not take away from the long term 'store of value' thesis, in our view," the analysts wrote.
"This maturation phase of bitcoin is less appreciated and the criticism has largely come from its lack of retail momentum -- which may not be a bad thing."
The argument runs counter to a broader sense of stagnation that has hung over the crypto industry this year.
After securing a series of regulatory and political wins, the sector has struggled to generate the excitement that once made it a dominant force in financial markets.
Yet Bernstein suggests bitcoin's newfound dullness may ultimately be evidence that it is evolving into a more established asset class, with a broader investor base that includes ETFs, treasury companies and banks, rather than just retail traders.
(Niket Nishant)
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