Bitcoin fell 53% peak to trough. What that does to a portfolio depends almost entirely on how much of it you own, according to CoinShares’ Research.
Volatility has been the standing objection to bitcoin since it first had a market price, and the objection is fair. Bitcoin has fallen more than 50% ten times in its traded history. It closed 2 August at $63,470, roughly 49% below its 6 October 2025 high of $124,774, having bottomed at $58,551 in June for a peak-to-trough fall of 53%.1
The historical record is the useful frame. Every previous drawdown of that depth resolved in full, by eventually making a new high. No cycle downturn has yet proven permanent.
Whether that pattern holds again is not something an advisor can act on. Position size is.
What a 5% sleeve did
Against a multi-asset baseline returning 4.8% annualised, with 12.3% volatility, a Sharpe ratio of 0.39 and a maximum drawdown of 24.1%, adding a rebalanced 5% bitcoin sleeve produced 8.2% annualised and a Sharpe ratio of 0.67, based on models established from January 2020 to June 2026. Volatility? It was essentially unchanged at 12.2%. Worst-case drawdown widened by 160 basis points, to 25.7%.
