Bitcoin Volatility Cools Even as Fed Risk Lingers
Bitcoin is trading around $64,085, up about 3.3% for the month. Even as a hawkish Federal Reserve and renewed Middle East tensions keep markets on edge, the waters are steadily calming for the premier cryptocurrency.
Key Takeaways:
- Bitcoin trades near $64,000 as Fed policy and geopolitical risk keep pressure on prices.
- Peak daily volatility has fallen from 7.58% in 2013 to a record low of 2.24% in 2025.
- A 5% bitcoin allocation lifted a 60/40 portfolio’s return to 11.64% from 8.56% annually.
According to CoinShares, this kind of choppy trading matches what its research on bitcoin’s volatility would predict. The firm argues that the swings are becoming less severe as more long-term, institutional holders enter the market.
See more: Cryptocurrencies: Bitcoin Back Above $60K
James Butterfill, head of research at CoinShares, said that the Fed remains the biggest swing factor for bitcoin right now. The June Federal Open Market Committee minutes carried extra weight, he said, because Fed Chair Kevin Warsh has yet to offer a clear public view on rates. The committee held its benchmark at 3.50% to 3.75% while dropping language that had suggested a lean toward cuts.
Spot bitcoin ETFs saw roughly $8 billion in outflows over eight weeks, the longest such streak on record, Butterfill said. He added that renewed buying over the past few trading days suggests that forced selling may be running out of steam. This is often the first sign that a market is bottoming.
Bitcoin’s Wild Swings Have Been Cooling
This backdrop lines up with CoinShares’ broader case for bitcoin: volatility is not a flaw to engineer away, but a natural feature of an asset still finding its footing. Bitcoin’s peak daily volatility has fallen from 7.58% in 2013 to a record low of 2.24% in 2025. According to CoinShares, the volatility has leveled as institutional participation has deepened. Annualized volatility, meanwhile, has also come down, from levels that regularly topped 150% before spot bitcoin ETFs launched.
CoinShares pointed to a mix of forces that are still shaping bitcoin’s price swings. This includes its growing sensitivity to Fed policy and dollar liquidity, event-driven jolts from regulatory news, and leverage in crypto derivatives markets that can amplify moves in either direction.
The firm’s own modeling makes a numbers-based case for holding through that volatility. A traditional 60/40 portfolio returned 8.56% annually from January 2020 through March 2026, CoinShares found. A version that swapped in a 5% bitcoin allocation returned 11.64% annually, with the Sharpe ratio, a measure of risk-adjusted return, rising from 0.71 to 0.93.
Investors tracking how much volatility the market expects going forward can watch the CME CF Bitcoin Volatility Index, according to CoinShares. The index uses options pricing data to estimate expected price swings over the next 30 days.
For exposure without holding bitcoin directly, the CoinShares Bitcoin ETF (BRRR) carries a 0.25% expense ratio and has gathered $366.1 million in assets since its January 2024 launch, according to ETF Database.
CoinShares will host an educational webinar exploring opportunities in bitcoin equities and how investors can capture the tailwinds generated by AI infrastructure. The session takes place July 14 at 12:30 p.m. ET. Register here.
For more news, information, and strategy, visit the CoinShares Crypto ETF Hub.
