Bitcoin’s Sharpe Ratio Near Zero — A Rare Risk Signal
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Bitcoin’s Sharpe ratio has fallen to nearly zero, matching levels from 2019, 2020, and 2022 market bottoms, as 8% of all BTC moved onchain in historic volatility.
A Bitcoin technical indicator known as the Sharpe ratio, has dropped to nearly zero, reaching levels usually seen near major market bottoms.
The Bitcoin Sharpe ratio is at “a level historically associated with moments of maximum uncertainty and the early stages of risk repricing,” said CryptoQuant analyst I. Moreno on Monday.
The analyst observed that Bitcoin is now entering the same zone seen in 2019, 2020 and 2022, when the ratio spent time at “structurally depressed levels” before new multimonth trends emerged.
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