5-year analysis of Bitcoin vs. Ethereum risks
Ran a 5-year analysis and here are some highlights on the risk side of things:
ETH has a higher return, but also much higher volatility.
ETH has both higher Sharpe and higher Sortino, so better risk adjusted returns overall even if you only take volatility to the downside.
Max drawdowns are similar, but ETH time to recovery was a brutal 1162 days compared to 470 for BTC.
This scorecard from Gale Finance compares the 5-year performance of Bitcoin and Ethereum from 2021 to 2025. Ethereum delivered a higher total return of 307.0% compared to Bitcoin's 198.1%. Bitcoin won 4 out of 5 individual years, while Ethereum won 1 year. A $10,000 investment in Bitcoin would be worth $29,811.31 by the end of 2025, whereas the same investment in Ethereum would be worth $40,695.17. Ethereum had better risk-adjusted returns with a higher Sharpe ratio of 0.70 compared to Bitcoin's 0.59.
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