Bitcoin: safer, not better.
Backtest onlyNo real moneyDaily prices, 2013–2026
Before the pilot, we asked whether Bitcoin would be a better market for the bot than stocks. We tested three ideas on Bitcoin prices from 2013 to 2026, with the pass marks written down before the prices were even downloaded.
The ideas
- Follow the trendHold Bitcoin only while its price is above its average of the last 10 months. Otherwise, hold cash.
It avoided the worst of the crashes, but it fell behind in the 2019–2021 boom.
- Step back when the market is nervousHold less Bitcoin when its price swings wildly.
On its own, it didn't protect much: in 2022 it still lost 54%.
- Both togetherFollow the trend, and within it, hold less when the price swings wildly.
The best result of all the research, and the one shown below.
The result
Both together, against simply holding Bitcoin.
Worst fall
−54%
Holding Bitcoin: −85%
Much safer
In 2022
+2%
Holding Bitcoin: −64%
Mostly out of the market
Money at the end
×1,900
Holding Bitcoin: ×6,300
Far less
Top: what $1 became, on a log scale. Bottom: how far it was below its previous high.
Show the yearly returns as a table
| Year | Holding Bitcoin | Both together |
|---|---|---|
| 2013 | +5475% | +2345% |
| 2014 | −56% | −26% |
| 2015 | +34% | 0% |
| 2016 | +124% | +123% |
| 2017 | +1336% | +298% |
| 2018 | −73% | −24% |
| 2019 | +94% | +43% |
| 2020 | +304% | +151% |
| 2021 | +59% | +27% |
| 2022 | −64% | +2% |
| 2023 | +156% | +63% |
| 2024 | +121% | +118% |
| 2025 | −6% | −11% |
| 2026 (to 7 Oct) | −5% | +6% |
The decision
How sure can we be that the advantage is real?
Follow the trend49%
Step back when the market is nervous18%
Both together72%
Bitcoin stayed out of the pilot. Both together held up against random luck, higher costs and delays. But in the 2019–2021 boom it did slightly worse than simply holding, and it never reached the bar of certainty.
What it is good for. If I ever hold Bitcoin, a simple trend rule greatly reduces the risk of losing 75–85%, in exchange for gaining less in the big rallies. That is risk management, not an edge, and not financial advice.
Almost all of its advantage came from three crashes, in 2014, 2018 and 2022. Three is a very small number to build on.
Next
A possible later step, not decided: test "both together" forward on paper, as a safety rule rather than a way to make more money. The stock pilot comes first.