Volatility Cooling, BTC Now ‘More Central’ Portfolio Asset – Expert

The price of Bitcoin has seen its volatility has declined over time, making the cryptocurrency a more suitable portfolio asset according to Coatue Management founder Philippe Laffont.

The tech-focused hedge fund leader addressed Bitcoin’s evolving role during Coinbase’s State of Crypto Summit.

Bitcoin Volatility Declines, Attracts Institutional Interest

Philippe Laffont highlighted Bitcoin’s reduced volatility as a key factor making the cryptocurrency more attractive for portfolio inclusion.

Speaking at Coinbase’s State of Crypto Summit in New York City, the founder of Coatue Management observed that Bitcoin price volatility has declined over the years, resolving one of the core issues that previously discouraged institutional investors.

The cryptocurrency has increased almost 13% in 2025 and has also been less volatile than in previous years.

Laffont clarified that the beta reading of price of Bitcoin, or the ratio of an asset’s volatility to its performance compared to the market, has been declining.

The decline in price volatility has made the cost and risk of investing in Bitcoin lower as perceived by institutional portfolios.

Historical performance data confirms this volatility comparison. In 2022, Bitcoin fell by more than 60% while the Nasdaq Composite fell by 33%. Recent market activity, however, has different trends.

After President Donald Trump’s April 2-April 10 tariff proposal, the price of Bitcoin pulled back by roughly 5% and the Nasdaq fell over 6%.

Institutional adoption has also confirmed the maturity of Bitcoin as a form of investment. BlackRock led the charge to list Bitcoin ETFs, a sign of institutional endorsement.

Further, Bitcoin wallet activity indicates long-term holding behavior, with less selling of the entire position following one month or more of holding.

Bitcoin’s Small Share of Global Wealth Suggests Growth Potential

Bitcoin currently accounts for approximately $2 trillion of the world’s total net worth of $500 trillion, indicating a relatively small portion of global wealth allocation.

Laffont emphasized this proportion when discussing Bitcoin’s potential for portfolio integration. He proposed that if Bitcoin is to continue to increase in popularity and perceived worth among investors, it needs to become more integral to investment portfolios.

The tech-oriented hedge fund entrepreneur admitted his early failure to recognize Bitcoin’s investment potential.

Even though Coatue invested in several crypto-related firms such as data provider Dune Analytics, bitcoin miner Hut 8, and artificial intelligence firm CoreWeave, Laffont conceded the Bitcoin opportunity didn’t clearly present itself to him at first.

Laffont described his investment style as liking simple, clear ideas over overly complex ones. He regretted missing out on Bitcoin’s fundamental value proposition during its earliest days, and he stated the worth of the cryptocurrency is in collective belief in its worth.

This realization made him consider Bitcoin as an inflation hedge, and he urged investors to make investments of one to four percent of their investments in Bitcoin for diversification and portfolio protection. Saylor’s Bitcoin purchase was also considered a threat to BTC’s status as a safe haven.

Institutional Investor Attitudes tToward Crypto Continue Evolving

Laffont identified three segments within his institutional client base regarding cryptocurrency investment strategy.

The first is an investor who does not intervene and allows fund management to make investment choices without particular crypto bias or limitation.

The second category of clients consistently questions missed opportunities in the cryptocurrencies market, questioning why major trends like Bitcoin were not anticipated earlier.

The clients view crypto as a missed investment opportunity and are curious about why previous portfolio choices excluded digital assets.

The third group includes risk-averse investors who are also fine with traditional forms of investment but as long as crypto investment is not included.

Laffont termed the group as the dying population and saw their decline with the end of each year as institutional sentiments drift towards the crypto-friendly direction.

Coatue’s CEO expects this distribution pattern to change over time, with fewer and fewer investors taking fully crypto-averse positions.

As passionate as he is about Bitcoin, Laffont emphasized the need to maintain balanced portfolio allocation rules when making investments in cryptocurrency. His comments come amidst price of Bitcoin trades at around $105,000.