Bitcoin has long carried the reputation of being one of the most volatile assets. But in 2025, the tables have turned, and this week marked a milestone that challenges that narrative. Amid the Fed rate cut, every company in the Nasdaq 100 index became more volatile than Bitcoin, according to 3-month realized volatility.
A similar shift is also visible on shorter and longer horizons. On a 1-year basis, Bitcoin’s realized volatility dropped to around 44%, near an all-time low. That makes it less volatile than 99 of the 100 companies in the index, with only industrial gas giant Linde still slightly lower — though Bitcoin is on track to dip beneath it in the coming weeks. That’s a sharp improvement from just a month ago, when Bitcoin was less volatile than 91% of the index.
On the 1-month measure, Bitcoin also outpaces nearly the entire index, proving more stable than 96 out of 100 stocks. Notably, despite this lower volatility, Bitcoin continues outperforming most stocks in returns, showing it can deliver strong gains with less risk.
Bitcoin Outshines Every Company in Magnificent 7 on Risk and Returns One of the most prominent examples of Bitcoin’s improved position against stocks is how it stacks up against the Magnificent 7, which includes Apple, Microsoft, Nvidia, Amazon, Meta, Tesla, and Google.
Last year, Fidelity highlighted that “Bitcoin’s volatility does not appear as an outlier” compared to megacaps, sitting in the middle of the pack. Today, Bitcoin’s realized volatility is lower than each member of the group, showing greater stability than the stocks that dominate equity market gains.
But volatility tells only part of the story. To assess whether returns are worth the risk, risk-adjusted metrics are key:
The Sharpe ratio, which measures returns relative to total volatility, The Sortino ratio, which looks at downside risk specifically, And CAGR, which reflects compounded growth over time. On these metrics, Bitcoin leads across the board against every member of the Magnificent 7. This week, Bitcoin’s 1-year Sortino rose to 2.38, with a Sharpe of 1.44 — both higher than most Nasdaq stocks.
What makes this shift more telling is the direction of change throughout 2025. Bitcoin’s Sharpe and Sortino have been stable or improving, signaling that returns are being delivered with less downside volatility and better overall efficiency. For the Magnificent 7, the opposite is true: ratios that were elevated at the start of the year have deteriorated. Nvidia, for example, saw its Sortino collapse from 3.19 in January to 1.07 in September, while Apple’s fell from 1.77 to 0.3.
The only outlier is Google, whose Sharpe ratio temporarily edged ahead of Bitcoin’s thanks to a double-digit price rally over the past month.
And yet, lower risk hasn’t come at the expense of returns that much. While volatility has cooled, Bitcoin has continued to outperform major stocks, with 1-year CAGR reaching 94%.
Why Bitcoin Is Calmer Than Stocks — and What Comes Next Bitcoin’s volatility has been steadily declining each year, and 2025 is no exception. Its 1-year realized volatility has already dropped by 17% since January, while its 1-month measure is down by 30% over the same period. There are two major reasons behind this trend.
First of all, the asset has matured: as Bitcoin’s market cap grows, the same inflows or outflows that once caused sharp swings now disperse across a much larger base. New capital inflows simply do not move the marginal buyer or seller as dramatically as they once did.
Since Bitcoin was confidently outperforming the rest of the stock market and saw an improved liquidity landscape, its scale-fueled volatility was shrinking at a faster pace. That’s also why Bitcoin has been registering smaller-scale bull runs with each consecutive cycle.
Secondly, Bitcoin is increasingly perceived as a store of value asset, not a speculative one. This can be seen amid Bitcoin’s resilience during recent market shocks.
In April, Trump’s reciprocal tariffs announcement sent stock volatility to its highest levels since the COVID crash, with Nasdaq 100’s weekly realized volatility spiking more than fivefold. For comparison, Bitcoin’s equivalent gauge “only” tripled.
Again in August, weaker labor data and a lower-than-expected PPI report doubled S&P 500 and Nasdaq 100 1-month volatility, but Bitcoin’s volatility rose just 70%. These smaller reactions to external shocks have left Bitcoin’s long-term realized volatility looking calmer than most Nasdaq names.
At the same time, Bitcoin’s drawdowns are becoming less severe. Earlier cycles were marked by brutal 70-80% crashes, cementing its reputation as a high-risk asset. However, throughout this cycle, some of Bitcoin’s corrections have been milder than those of the S&P 500 or Nasdaq. This not only reinforces the decline in realized volatility but also shows greater resilience during downturns.
Conclusion For years, volatility was the one of the most popular factors that kept many institutional investors on the sidelines of Bitcoin, framing it as too unpredictable to fit into traditional portfolios. Yet what was once a weakness may now be turning into a strength: Bitcoin can now look like a relatively safer bet than many mainstream equity options. With its market structure maturing and its reactions to macro shocks becoming increasingly muted, Bitcoin’s volatility is likely to keep declining, reshaping how the asset is perceived in the broader financial landscape.
Sources The data used for this research consists of publicly available information from TradingView, Fidelity, MarketWatch, and CheckOnChain. Volatility, Sharpe, Sortino, and CAGR comparisons were conducted on September 17, 2025, reflecting market conditions and price dynamics observed at that date.
