Philippe Laffont, founder of Coatue Management, attended Coinbase’s State of Crypto Summit in New York City and said that Bitcoin was becoming more attractive to institutional investors because its volatility has decreased. Laffont argued that crypto’s beta values have decreased, making digital assets like Bitcoin a key component of a modern-day portfolio. Philippe Laffont manages a tech-focused hedge fund and is interested in cryptocurrencies.
Bitcoin has experienced dramatic swings over time, turning off investors from buying the digital asset. Laffont was one of those investors who stayed away from Bitcoin due to its volatility. Bitcoin has surged through 2025 but has reduced its volatility over time. Laffont argues that Bitcoin has less volatility than it did years ago and may become even more attractive to future investors.
Bitcoin has changed its market dynamics over time. Laffont pointed out that Bitcoin dropped 60% during 2022, while the Nasdaq Composite only dropped 33%. Conversely, Bitcoin only fell 5% in 2025 when President Trump introduced tariffs, while Nasdaq dropped 6%. The hedge fund manager believes this signifies Bitcoin’s growing maturity. Laffont also believes institutional investors drive down volatility by making informed decisions about adding Bitcoin to their portfolios. Bitcoin trades above $100k and fluctuates moderately given its high price bracket.
Laffont, an experienced hedge fund manager, said that Bitcoin was once considered a speculative asset, but was now becoming more foundational, and could start to look more like a legacy market. Laffont avoided Bitcoin in the past due to how unstable it was. But now, according to Laffont, the math is changing, and the cost of getting into Bitcoin is decreasing. Laffont surmised that if the beta value of Bitcoin continues to go down, then the crypto market will become even more interesting. A beta value compares the volatility of an asset to the broader market.
Coatue Management has invested in various crypto businesses, including Dune Analytics and Hut 8. Coatue specialises in technology investments, which fits the market of cryptocurrencies and artificial intelligence. However, Laffont avoided crypto for some time due to issues with its underlying pricing structure. Laffont claims that he wakes up at 3 AM every night and bemoans what an ‘idiot’ he had been for not getting into crypto earlier. He asks himself over and over again why he didn’t invest more in crypto. During Laffont’s time as a hedge fund manager, he gained experience. He learned that simple ideas are much better than complicated ones regarding investment decisions. He admits that his team deliberated for years over use cases for Bitcoin and failed to see its simplistic value right before them.
Laffont analysed the dynamics of Bitcoin and noticed that traders were holding their tokens for more extended periods, specifically concerning the number of traders holding tokens over one month. According to Laffont, the rate of traders selling Bitcoin after just one month has been dramatically reduced. Traders are making fewer in-and-out transactions, and are contemplating Bitcoin as a long-term store of value. Traders, therefore, are treating Bitcoin more like an investment and less like a speculative asset. According to Laffont, this behavior change is changing the portfolio dynamics of digital assets. Laffont also noticed that big names were getting involved in cryptocurrencies, which was another key sign that the market was changing. He saw that BlackRock was getting involved in Bitcoin and was even playing a pivotal role in introducing crypto ETFs to the investment community. Laffont reasoned that more big names were bound to get involved after a few announced their interest in Bitcoin.
