Investment Funds Are Flocking to Crypto Stocks. Are They Safer or Riskier?
Cathie Wood’s ARK Invest purchased approximately US$77 million worth of crypto-related stocks throughout June. According to ARK’s daily trade disclosures, the firm bought US$44 million in Coinbase (COIN), US$25.25 million in Circle (CRCL), and around US$8.2 million in Bullish (BLSH). The purchases came during Bitcoin’s worst monthly performance in four years.
The move reinforces a long-held investment thesis shared by Cathie Wood and several institutional investors: crypto-related equities provide a regulated way to gain exposure to the digital asset market without directly holding cryptocurrencies.
However, CryptoSlate’s analysis of daily price data through July 2 suggests that this approach comes with its own trade-offs. Among nine U.S.-listed crypto stocks, annualized 30-day realized volatility ranged between 68% and 90%, nearly twice Bitcoin’s realized volatility of approximately 37.6%.
Over a 90-day period, Circle’s realized volatility reached 103.6%, while Bitcoin’s stood at just 37.8%. Circle has also fallen 51.4% from its 2026 peak, Strategy (MSTR) is down 48.6%, and Bullish has declined 43.6%. These losses are steeper than Bitcoin’s 36.4% correction from its January high of around US$97,000.
At first glance, the higher volatility could make these stocks appear to be leveraged versions of Bitcoin. However, correlation data tells a different story. Correlation measures how closely two assets move together, with a value of 1 indicating nearly identical price movements and 0 indicating no relationship.
Over the past 90 trading days, Circle, Robinhood (HOOD), and Bullish recorded correlations of only 0.55 to 0.58 with Bitcoin. This means that only about one-third of their daily price movements were driven by Bitcoin, while the remaining fluctuations were influenced by company-specific factors such as earnings reports, competitive pressures, financing needs, and share dilution.
In other words, investors buying crypto stocks are exposed not only to Bitcoin’s price movements but also to the operational risks of the underlying companies.
Strategy Is the Closest Bitcoin Proxy
Among the companies analyzed, Strategy is the only stock that closely mirrors Bitcoin’s performance.
The stock has a beta of 1.59 and a correlation of 0.85 with Bitcoin, meaning that a 1% move in Bitcoin has historically translated into roughly a 1.59% move in Strategy’s share price. As a result, the stock tends to amplify both Bitcoin’s gains and losses.
Coinbase, meanwhile, offers what appears to be the most balanced exposure. Its shares have fallen about 26.8% year-to-date, slightly outperforming Bitcoin. The stock has a beta of 1.26 and the second-highest correlation with Bitcoin in the group. Even so, Coinbase’s realized volatility remains nearly twice that of Bitcoin, and its shares are still about 60.6% below their all-time high of US$419.78 reached in July 2025.
Circle provides perhaps the clearest example of equity risk outweighing crypto exposure. It has the lowest correlation with Bitcoin and the highest 90-day realized volatility at 103.6%.
That became evident on June 30, when Circle shares plunged 17.5% in a single trading session following the launch of Open USD, a competing stablecoin backed by more than 140 companies, including Coinbase, Stripe, Visa, Mastercard, and BlackRock. The decline had little to do with Bitcoin’s price and was instead driven by increasing competition within the stablecoin industry.
Robinhood presents a different picture. Its shares are down just 0.3% year-to-date, with the shallowest drawdown in the group at around 8.5%. This relative stability stems from Robinhood’s diversified business, which includes stock, options, and derivatives trading in addition to crypto services.
Meanwhile, Bitcoin mining companies have delivered some of the strongest returns in the sector. Riot has gained approximately 74.5% this year, MARA is up 38.1%, and CleanSpark has climbed 24.7%, despite Bitcoin falling around 29.5% over the same period.
Their strong performance has been driven by a strategic shift toward high-performance computing (HPC) and artificial intelligence (AI) infrastructure. Revenue generated from AI-related services has become a key growth driver, reducing their dependence on Bitcoin’s price movements alone.
