Bitcoin Closed May 4% Lower, While Its Volatility Is Starting to Match Gold’s

Bitcoin’s price was choppy this week, but the story I found most interesting is a chart from Bloomberg's Eric Balchunas showing that BTC's volatility is now approaching gold's. 

TL;DR

• Bitcoin ends the month down 4% after a strong start to May, as U.S.–Iran peace negotiations stalled and risk-off sentiment returned.

• Bitcoin's realized volatility is converging with gold's, per Bloomberg's Eric Balchunas, which shows that the structural maturation story is showing up in the data. 

May Started Strong But Ended Weaker 

May kicked off strong, with Bitcoin rallying from $75,400 to over $82,200 in the first week, with ETF inflows returning and sentiment warming up.

Then, the second half of the month happened.

Peace talks between the U.S. and Iran stalled, the Strait of Hormuz situation heated back up, and Bitcoin corrected to roughly $73,800 by month-end, around 4% lower on the month and about $9,000 off its early-May high.

The spot ETFs felt it. Over nine trading days, the funds saw more than $2.8 billion in outflows, headlined by a single $1.3 billion IBIT off-exchange trade on May 26.

It looks dramatic on the surface, but we've seen this movie before.

Similar drawdowns played out in December 2025, August 2025, and during the spring 2025 tariff scare. Every time, the Bitcoin price rebounded and recovered within two to three months to previous levels. Let’s see how it goes this time round.

Bitcoin’s Volatility Is Getting Closer to Gold’s 

Probably the most interesting Bitcoin story I came across this week is that Bitcoin’s volatility is starting to move more in line with gold’s.

Bloomberg ETF correspondent Eric Balchunas flagged that up in a tweet.  

Having spent years on the TradFi side of the fence, I can tell you the single most common pushback to Bitcoin in institutional portfolios has always been "too volatile."

Now, that objection is dying right in front of us. As the ETF complex absorbs more of the float and corporate treasuries keep stacking, the swings shrink. Bitcoin is starting to trade like the sound-money asset our thesis has always said it is.

Therefore, while the data and numbers from the ETF may appear high, they are actually tracking with the broader market sentiment.

Despite all this, we still saw major Wall Street firms getting on board with digital assets last month, either by launching new Bitcoin-native ETFs or by tokenizing funds.

While the marco environment is still looking a bit messy, the institutional bid for Bitcoin definitely isn’t. We’re watching Bitcoin grow up in real-time. 

Elsewhere in Bitcoin 📖

A quick look at what else has been happening in Bitcoin: 

• The CFTC approved the first U.S. perpetual futures contracts on an exchange

• One Satoshi is now worth more than one Niara, Nigeria's national currency

• Someone inscribed the entire U.S. Constitution onto the Bitcoin blockchain

• SEC Chair Paul Atkins is confident that the CLARITY Act will pass soon

• So far, this is the best-performing Bitcoin bear market 

Your fellow stacker in sats, 

Patrick Lowry

PS: If you want to see how the value of goods and services changes when priced in Bitcoin, check out the Samara Bitcoin CPI. It might give you a new perspective on holding Bitcoin on your company’s balance sheet or just as an individual.

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