MicroStrategy’s 2024 Gains Defy December Setback, Leading the Charge in Crypto-Tied Asset Rankings
MicroStrategy (MSTR), the software company that has transitioned into a major bitcoin (BTC) buyer, has had a rough December, with its stock plunging nearly 50% since November. This drop came after a remarkable 600% surge earlier in the year, following the company’s addition to the Nasdaq 100 index. Despite the recent dip, MicroStrategy’s stock is still up a staggering 342% in 2024, positioning it as the top performer among crypto-linked assets in traditional finance (TradFi).
This year has been marked by extreme volatility, as geopolitical tensions and technological advancements have shaken global markets. The ongoing conflicts in Eastern Europe and the Middle East, elections worldwide, the unwinding of the yen carry trade in August, and the rapid rise of artificial intelligence (AI) have all contributed to the turbulence.
Even with recent struggles, MicroStrategy’s return is nearly twice that of Nvidia (NVDA), which gained 185% thanks to its role in producing chips for AI. Other tech heavyweights like Meta Platforms (META) saw more modest growth, with a 71% increase in stock value. Bitcoin itself surged by 100%, fueled by the approval of U.S. spot exchange-traded funds (ETFs) in January and a series of new all-time highs. Bitcoin outperformed its rivals, ether (ETH), which rose 42%, and Solana (SOL), which gained 79%.
Among the ETFs, the iShares Bitcoin Trust (IBIT) also posted a return of over 100%, quickly becoming the fastest ETF to reach $50 billion in assets.
The Bitcoin mining sector, however, saw more mixed results. The Valkyrie Bitcoin Miners ETF (WGMI), which tracks mining stocks, rose just under 30%. Despite strong demand for mining power from AI and high-performance computing (HPC) sectors, the broader mining stocks failed to match the returns of Bitcoin itself. Still, some individual miners excelled, such as Bitdeer (BTDR) with a 151% gain and WULF (WULF) with a 131% increase, both of which outperformed the broader market.
On the equity front, the Nasdaq 100 Index (NDX) added 28%, while the S&P 500 Index (SPX) rose 25%. Gold also outpaced the S&P 500 with a 27% gain, continuing its pattern of outperforming equities in three of the last five years.
Treasury yields saw a dramatic increase, driven by inflation concerns and a growing budget deficit. The yield on the 10-year Treasury climbed 15%, reaching 4.5%, and rose by a full 100 basis points since the Federal Reserve began reducing interest rates in September.
The iShares 20+ Year Treasury Bond ETF (TLT), tracking longer-term bond prices, dropped 10% in 2024, bringing its total losses over the past five years to 40%.
The U.S. dollar also showed its strength, with the DXY Index climbing to its highest point since September 2022, reflecting investor confidence in the greenback. West Texas Intermediate (USOIL) ended the year up slightly, rising less than 1% to around $71 per barrel, despite significant price fluctuations throughout the year, including a brief spike to nearly $90.
As the new year approaches, market watchers will focus on critical issues such as the U.S. debt ceiling debate, the policies of President-elect Donald Trump, and whether the U.S. can continue to sustain its economic growth in the face of ongoing global uncertainties.
