Throughout its existence, Bitcoin has been one of the most volatile assets in the market. However, Bitwise’s Chief Investment Officer, Matt Hougan, suggests that it is beginning to stabilize.
In an editorial for The Wall Street Journal titled “Bitcoin Is Right on Schedule,” Hougan posits that Bitcoin’s decreasing volatility indicates it is evolving into a form of digital gold. His main data point highlights an annualized volatility of 66% over the past ten years, contrasted with just 44% in the previous year.
Published on October 5, 2026, this op-ed addresses a recurring criticism. Detractors have often argued that such erratic price movements disqualify Bitcoin from being a reliable store of value.
While Hougan readily acknowledges that Bitcoin’s volatility is still quite high, he emphasizes that the trend is moving in a positive direction.
Within the last year, Bitcoin’s price fluctuated between $58,000 and $126,000, landing around $85,000 at the time of the article’s release.
One of the most compelling aspects of Hougan’s argument is his comparison to the Nasdaq-100 index, which currently exhibits volatility in the mid-20% range.
He predicts that Bitcoin’s volatility could eventually drop below that of the Nasdaq-100. This is merely an estimate and would require Bitcoin to reduce its volatility by nearly half based on the previous year’s figures.
Hougan also provides a long-term perspective on Bitcoin’s journey, noting that it has surged from under $1 to approximately $85,000.
He disputes the notion that decreased volatility signifies diminishing enthusiasm, arguing instead that it represents an increase in market engagement rather than stagnation.
When an asset is owned by a limited group, significant trades can lead to drastic price changes. As more investors enter the market, each trade’s impact is reduced, leading to more stable prices.
Hougan frames this as a necessary transition as institutional interest grows. In his view, Bitcoin is shifting from a speculative asset to a more established investment, with volatility trends serving as proof.
For asset allocators, the trend in volatility is more significant than any specific price point. Many institutional investors determine their allocations based on risk, with volatility being the key metric in this calculation.
An asset exhibiting 66% volatility is likely to receive a minimal allocation, if at all. Conversely, an asset with 44% volatility can command a larger share within the same risk framework. If Hougan’s prediction comes to fruition and Bitcoin’s volatility drops below that of the Nasdaq-100, the calculus will shift once again.
The crucial factor to monitor moving forward is the difference between Bitcoin’s rolling volatility and the mid-20% range of the Nasdaq-100. Should this gap continue to close, Hougan’s assertion that Bitcoin is on the right track will gain greater validity.