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Institutional investors navigating Bitcoin’s latest price swings may be feeling uneasy, but long-time crypto participants see the pullback as completely normal. According to crypto entrepreneur and investor Anthony Pompliano, Bitcoin’s sharp declines are routine events that seasoned holders have learned to expect — even if Wall Street is still adjusting to the turbulence.
In a recent appearance on CNBC’s Squawk Box, Pompliano explained that Bitcoin typically experiences sizable retreats every year or so. While the digital asset has slipped from recent highs, he believes this type of movement is nothing unusual for those who understand Bitcoin’s long-term behavior.
Bitcoin’s Volatility Is Normal for Long-Time Holders
Over the last decade, Bitcoin has witnessed dozens of steep corrections that would shake traditional financial markets. Pompliano noted that the crypto asset has dropped by 30% or more on 21 different occasions during that period.
“Bitcoiners are used to this,” he said. “This is what happens in this market. But for many people coming from Wall Street, this kind of volatility is completely unfamiliar.”
Many new institutional investors entered the market in 2024–2025 amid strong inflows, new ETF products, and renewed macro optimism. Now, facing their first major drawdown, some may be reconsidering their exposure, especially as year-end bonus calculations and portfolio performance pressures come into play.
“These new people are very fearful,” Pompliano added. “They’re trying to decide whether they should hold or sell, and that’s putting some downward pressure on the price.”
Recent Bitcoin Sell-Off Driven Primarily by the U.S. Market
While global market sentiment has weakened, some analysts suggest the recent correction has been concentrated in U.S. trading hours. Matthew Sigel, head of digital assets research at investment manager VanEck, said the slump to around $82,000 was “overwhelmingly a U.S.-session phenomenon.”
Sigel highlighted two critical factors: tightening U.S. liquidity conditions and widening credit spreads. He explained that concerns over massive capital expenditures connected to artificial intelligence collided with increasing stress in credit markets, leading to heightened risk aversion among investors.
As a result, Bitcoin faced more intense selling pressure in the U.S. compared to Europe or Asia.
Volatility Is a Feature, Not a Bug, of Bitcoin
Bitcoin’s price fluctuations have increased noticeably over the past two months. Bitwise market analyst Jeff Park observed that volatility levels had been climbing back toward 60, a zone typically associated with large and rapid price movements in both directions.
Despite the concerns of traditional investors, Pompliano argued that volatility is essential for Bitcoin’s long-term growth. According to him, the asset’s impressive performance throughout its history has been enabled — not hindered — by these dramatic swings.
“It’s not a negative,” Pompliano told CNBC. “I would be worried if Bitcoin’s volatility went to zero. You need volatility for the asset to go up.”
He pointed out that Bitcoin has surged more than 240x in the last decade, delivering an extraordinary 70% compound annual growth rate (CAGR). While he acknowledged that the same level of explosive expansion is unlikely to continue indefinitely, Pompliano believes Bitcoin is still positioned to generate substantial returns over the next ten years.
Long-Term Outlook Remains Strong Despite Short-Term Noise
Pompliano stressed that even if Bitcoin achieves only a fraction of its historical growth rate, it would still outperform most traditional investments. A CAGR of 20% to 35%, he said, would leave equities behind and reward those who stay patient through the volatility.
“Bitcoin doesn’t need to repeat its past performance to be a strong asset,” he said. “A moderate growth rate would still deliver exceptional results for long-term investors.”
This perspective aligns with the broader sentiment among experienced crypto holders, many of whom view downturns as strategic buying opportunities rather than reasons for panic.
Wall Street Learns the ‘Bitcoin Cycle’ for the First Time
As institutional adoption accelerates, Wall Street investors are being introduced to market dynamics that differ significantly from stocks, bonds, and commodities. Bitcoin’s unique combination of global liquidity, 24/7 trading, and retail participation creates price movements that can be jarring for those used to more controlled environments.
But Pompliano believes this adjustment phase is temporary. Over time, institutions will better understand Bitcoin’s patterns — including its periodic 20%–30% pullbacks — and incorporate them into their risk models.
“Bitcoiners have lived through this many times,” he said. “Now, Wall Street is learning what this asset really looks like.”
Conclusion
While Bitcoin’s latest drawdown has sparked concern among new institutional investors, long-term participants emphasize that volatility is a natural part of its market cycle. With analysts pointing to U.S. liquidity pressures and macroeconomic uncertainty as temporary drivers of the sell-off, the broader outlook remains constructive. As Pompliano suggests, those who embrace — rather than fear — Bitcoin’s volatility may ultimately benefit the most.
