Bitcoin Accumulator Outperforms Dollar-Cost Averaging for Corporate Investors
Research from OrBit Markets indicates that the accumulator strategy outperforms dollar-cost averaging (DCA) in cryptocurrency investments since 2023. Key findings include:
- The accumulator delivered a 10% outperformance over DCA for three-month periods.
- Six-month accumulators outperformed by 13%, and twelve-month accumulators by 26%.
- Accumulators provide a disciplined approach to token accumulation, suitable for crypto treasury companies.
The accumulator operates by allowing investors to purchase assets at a fixed, discounted price over time with an obligation to buy if prices fall below the strike price, making it unsuitable for day traders or speculators.
Accumulator Mechanics
- An investor commits to buying a certain asset amount at a set interval for a period.
- A knock-out barrier terminates the structure if the asset price exceeds a specified level.
Backtesting results show:
- Average BTC acquisition cost of $39,035 for the accumulator is 10% lower than the DCA average of $43,329.
- Longer maturity accumulators achieved costs of $37,654 and $32,079 for six and twelve months, respectively.
This data suggests that accumulators may be a more effective strategy during bullish market conditions compared to DCA.