Gold in the 1970s Was More Volatile Than Bitcoin Today, Bloomberg Analysis Shows
Bloomberg analyst Eric Balchunas shared historical annual-return data (1972–1981) originally compiled by Bitwise CIO Matt Hougan, showing that gold’s volatility in the 1970s exceeded Bitcoin’s contemporary volatility. The dataset—initially mistaken by some as crypto returns—illustrates dramatic price swings after the 1971 collapse of the Bretton Woods system, when gold moved from $35/oz to nearly $850/oz by January 1980. Analysts use this comparison to challenge narratives that label Bitcoin uniquely unstable, arguing that emerging stores of value typically undergo high volatility during price discovery. Key points: gold annualized volatility exceeded 40% in certain years (1972–1981); Bitcoin’s recent 30-day annualized volatility typically ranges 30–80% but has trended lower over longer horizons; structural factors behind 1970s gold swings included monetary policy shifts, stagflation, geopolitical shocks, and changing regulation. Bitwise’s Hougan contends Bitcoin may follow gold’s path toward broader institutional adoption and reduced volatility as market cap and regulatory clarity increase. For traders, the takeaway is that historical precedent suggests volatility can decline with maturation, but short-term price risk remains while adoption and policy evolve.
Neutral
The report is primarily contextual and comparative rather than announcing new regulation, a major hack, or large capital flows that typically drive immediate directional moves. Comparing 1970s gold volatility with Bitcoin reframes the narrative around crypto risk, potentially reducing fear-driven selling among long-term investors and encouraging measured institutional interest. Short-term impact: neutral to mildly bullish as narrative improves but no direct liquidity or on-chain changes are reported; traders may see small position adjustments as sentiment shifts. Long-term impact: potentially bullish if the comparison supports gradual institutional adoption and regulatory maturation that historically lower volatility. Similar past events — historical analogies (e.g., early gold price discovery) or influential commentary — have tended to shift sentiment slowly rather than trigger abrupt market moves. Overall, this is an informational catalyst that alters perception more than immediate market mechanics.