Bitcoin's risk-adjusted returns have turned negative, according to a new analysis by CryptoQuant, signaling potential challenges for investors. The cryptocurrency's Sharpe Ratio, a key metric for assessing excess return relative to risk, has entered negative territory, reminiscent of patterns seen during the 2022 bear market. This suggests Bitcoin is currently generating minimal excess returns compared to its volatility, posing difficulties for both institutional and retail investors. Historically, Bitcoin's Sharpe Ratio has remained negative during extended market downturns, such as in 2018 and 2022, when the cryptocurrency experienced prolonged price declines. The current negative reading indicates similar market dynamics may be unfolding, although analysts advise against drawing direct parallels without considering broader macroeconomic factors. The negative Sharpe Ratio highlights the need for comprehensive market analysis, as it reflects Bitcoin's underperformance against risk-free alternatives like Treasury bills.