Bitcoin's rally has slowed this year. What does last year's extraordinary gains really mean?

Bloomberg senior ETF analyst Eric Balchunas recently pointed out that the Bitcoin market is going through a correction phase. Looking back at last year's performance, this digital asset recorded an astonishing 122% surge, far outperforming traditional financial assets. However, this year, signs of a clear slowdown in momentum have emerged.

**Normal correction after excess returns**

From a market cycle perspective, this change is not unusual. Bitcoin's strong performance last year implies significant accumulated gains, and the slowdown this year is actually a reasonable correction of those prior excess returns. Balchunas believes investors should not over-interpret short-term fluctuations but instead view the asset class's performance over a broader time frame.

**Viewing returns over a longer time horizon**

If we extend the observation period to two years, Bitcoin's overall return remains quite impressive, with an average yield of about 50%. This indicator reflects that, despite recent adjustments in momentum, Bitcoin as an emerging asset class still demonstrates relatively strong growth potential in the medium term.

This judgment provides an important perspective for market participants interested in ETF-related investment opportunities—short-term volatility should not obscure the positive signals of medium-term trends.