Bitcoin Outpaces S&P 500 by 99.98% Since 2012, Driving Institutional Shift

Bitcoin has made a significant impact on the financial landscape, challenging traditional benchmarks and gaining traction among institutional investors. The S&P 500, a widely followed stock index, reached a new high of 6,280 points. However, when measured in bitcoin, the S&P 500 has lost 15% of its value since the beginning of the year and a staggering 99.98% since 2012. This shift highlights bitcoin's growing influence as a unit of measure and a performance benchmark.

This perspective change is not merely a numerical observation but reflects a broader shift in how investors and analysts evaluate financial performance. Bitcoin's surge of 40,450% over the past decade outpaces major tech companies like Nvidia, Tesla, and Microsoft. This performance has transformed bitcoin into a new standard for measuring financial success, with many now looking at returns in BTC rather than just dollars.

The rapid rise of bitcoin is supported by several key factors. Spot Bitcoin ETFs have become a significant driver, with twelve US ETFs holding over 1.26 million BTC, or more than 6% of the global supply. These ETFs continue to attract substantial inflows, with a recent inflow of $1.17 billion, the second-largest ever recorded. Additionally, the US government has shown a pro-crypto stance, with the creation of a strategic bitcoin reserve and the vote on the GENIUS Act. Companies are also increasingly converting their treasuries into bitcoin, further solidifying its role as a strategic asset.

Another critical factor is the positive correlation between bitcoin and the global money supply, as indicated by the M2 indicator. This correlation suggests that bitcoin is increasingly seen as a hedge against inflation and monetary dilution. The growing number of publicly traded companies holding bitcoin further confirms this trend. This dominance is not just about raw performance but also about changing the rules of the game on Wall Street. Investors are increasingly evaluating performance in BTC, and bitcoin is becoming a long-term holding rather than a speculative asset.

BlackRock, the world's leading asset manager, has seen its Bitcoin ETF exceed expectations, attracting significant interest far faster than its S&P 500-based fund. This rapid adoption underscores bitcoin's growing acceptance in the mainstream financial world. As more institutional investors and analysts turn to bitcoin as a benchmark, its influence continues to grow, challenging traditional financial metrics and reshaping the investment landscape.