To lower crypto investment risk, the market is starting to diversify its digital asset bets

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Volatility is nothing new for crypto investors, and 2025 has been a wild ride, with bitcoin climbing above $125,000 in October before experiencing several sharp drops — peak to trough, a decline of over $40,000 from its record high.

“Crypto is a volatile asset class, and in some sense, there is no avoiding that volatility,” said Zach Pandl, head of research at Grayscale Investments, a digital currency asset management company which runs one of the largest bitcoin ETFs, the Grayscale Bitcoin Trust (GBTC). “It’s an alternative asset class, and we are seeking its particular return characteristics,” he said.

Bitcoin

is now trading near $88,000, and whether the next move is up or down, investors in the crypto space need to have what it takes to stomach the volatility. There may be some help — in the form of new market ideas and classic diversification concepts — to cushion portfolios from at least some of crypto’s risk-on nature. These are some of the ideas to consider.