Bitcoin's volatility has dropped from over 60 to around 35 for BlackRock's iShares Bitcoin Trust (IBIT), bringing it significantly closer to gold's volatility levels. According to Bloomberg ETF analyst Eric Balchunas, this tightening gap in volatility could be a 'good sign' for Bitcoin's institutional appeal. The 60-day volatility index for IBIT has fallen from over 60 to around 35, while gold ETFs' volatility dipped from 43 to around 25. However, Trace Mayer, creator of the Mayer Multiple, argues that bitcoin's declining volatility isn't a sign of weakness, but rather a direct reflection of its growing economic substance. As Mayer noted, 'Gary Gensler said he was going to 'tame bitcoin,' and we've seen the volatility come down'. The market has simply become too big to move as erratically as it once did, with 'the barbell getting heavier' from institutional participation.
The sophisticated mechanics of the options market, specifically call-selling, are driving Bitcoin's structural maturation. As institutions and digital asset companies increasingly sell covered calls against their bitcoin holdings to generate upfront premium income, they inadvertently create a dampening effect on price swings. When institutions sell call volatility into the market, market makers are forced to do negative delta, creating a natural structural ceiling on price spikes. Mayer explained that 'when you're able to come in and sell call volatility into the market, the market makers are going to have to do negative delta', adding weight to the asset's economic substance. This 'negative call wall' effect has transformed Bitcoin into a more mature, predictable asset that is growing up right in front of the market's eyes.
Despite the volatility improvements, both Bitcoin and gold ETFs have experienced significant outflows in recent months. Bitcoin ETF inflows topped $5 billion in early May but have since dropped to nearly zero, according to AMBCrypto reports. Gold ETFs recorded nearly $8 billion in outflows over the same period, with JPMorgan analysts attributing this to a 'cool-off of the debasement trade' as investors anticipate a likely U.S.-Iran deal. The analysts noted that the debasement trade was at its peak during the early months of the West Asia crisis, which sparked inflation fears, but there is no need for macro hedges like gold or BTC if the energy shocks are addressed by a potential U.S-Iran deal. At the time of writing, Bitcoin was trading at $73.5K, down 11% from its Q2 high of $82.8K, though based on historical BTC/gold ratio analysis, the bottom for Bitcoin may have been hit or could be formed soon.
The Bitcoin portion of Fidelity's report centers on Iran and the Strait of Hormuz, where reports suggest Iran accepted Bitcoin for tolls and related payments tied to oil route activity. In April 2026, the Iranian government announced it would accept oil shipping tolls in Bitcoin, US dollar-pegged stablecoins and Chinese yuan, according to Fars News agency. The government's Economy Ministry proposed an insurance-based model for ships using the Strait of Hormuz, which could generate more than $10 billion for Iran through marine insurance policies and financial responsibility certificates. Under this framework, managing the Strait through an insurance framework would enable the issuance of various marine insurance policies as well as certificates of financial responsibility, with payments 'settled at the speed of blockchain'.
Bitcoin's maturation is evident in its growing institutional presence and market structure. Mayer pointed to tens of thousands at conferences this year and much more last year, compared to his blog running in 2008 before Bitcoin existed when he regularly presented at gold conferences drawing 2,000-3,000 attendees. The asset has graduated from a speculative instrument into something that investment committees, family offices, and corporations can actually underwrite. Bitcoin is currently just below its long-term trend at 0.94, with the standard deviation bands compressed significantly as more trading history accumulates. From May 20 to May 29, XRP funds took in $35 million while bitcoin and ether ETFs lost roughly $2 billion combined, with U.S.-listed spot XRP ETFs drawing $11.88 million in net inflows on May 29. Despite acknowledging risks like weakening network security and quantum computing threats, Mayer remains firmly in the bitcoin-over-gold camp for the next 15 years, citing Bitcoin's '21 million' fixed supply versus gold's supply constraints.
