Crypto or Stocks: What’s Better for Long-Term Investors?

Crypto and stocks both aim to grow your money over time.

But they do that in very different ways. Stocks have built decades of steady returns—typically around 6–10% per year. Crypto, like Bitcoin, Ethereum, VeChain, or SafeHaven, has delivered massive gains—hundreds of percent in some years—but also huge crashes.

This article helps you see which asset might suit you best long-term. We compare returns, risk, volatility, and portfolio roles. And we highlight common myths, smart strategies, and what the future may hold.

Let’s dive in.

What Are Stocks and Cryptocurrencies? Key Differences Explained

Crypto and stocks aren’t the same.

Stocks represent ownership in a company. When you buy a share, you own a piece of that company. You may receive dividends and voting rights. Stocks trade on regulated exchanges during business hours. They’re backed by real earnings and assets.

And crypto is different. Cryptocurrencies are digital assets, held in digital wallets, secured by cryptography. You don’t own part of a company. Instead, you hold coins or tokens on a blockchain. There’s no dividend and no voting rights in the usual sense .

But they share some traits. You buy both through online platforms. Trades use the same order types—market, limit, stop orders. If you're new to crypto, you can buy BTC online with a debit card through trusted platforms like Changelly, which offers fast transactions and a user-friendly interface.

Stocks are mature and highly regulated. Exchanges operate set hours, and companies must show financial reports. Crypto is newer, less regulated, and trades 24/7.

Understanding these basics sets the stage. It helps you compare returns, risks, and how each fits in a long-term plan.

Crypto vs Stock Market Returns: Which Performs Better Over Time?

Crypto has far outpaced stocks in past decades.

Bitcoin’s 10-year average annual return has been around 49%—though analysts say that pace isn’t likely to continue. Newer data shows Bitcoin soared roughly +29,000% between 2015 and 2025, compared to the S&P 500’s +178% and FTSE All-World’s +107% .

And long-term, stocks still offer solid growth. The S&P 500 has returned about 10% annually over many decades. After inflation, that’s roughly 6–7% yearly real return .

But crypto’s returns are extreme. Bitcoin delivered 671% in its biggest year, and some estimates even claim 124% annualized over 10 years. The gains come with huge spikes and crashes.

This section shows raw performance. Later, we’ll examine how volatility and risk change those numbers when comparing crypto and stocks side by side.

Crypto vs Stocks: Which Is Riskier and More Volatile?

Crypto is far more volatile than stocks, and therefore more prone to pump & dumps.

Bitcoin’s annual volatility has hovered around 45–50%, compared to about 15% for the S&P 500. That’s roughly three to four times higher risk.

But even mega-cap stocks can outpace Bitcoin on volatility. Fidelity found Bitcoin less volatile than around 33 S&P 500 stocks—and 92 stocks were once riskier than Bitcoin. So crypto isn’t always the wildest ride.

Risk‑adjusted returns matter. The Sharpe Ratio—returns per unit of risk—shows Bitcoin at ~0.55 vs. ~0.26 for the S&P 500. That signals crypto may offer more reward for each risk‑dollar taken.

And that’s backed by research from Grayscale: crypto delivers returns relative to risk comparable to major asset classes, despite higher volatility.

But beware of extreme drawdowns. Bitcoin has heavy tails—big crashes happen more often than in the stock market.

This section shows crypto is higher‑risk but also potentially higher-reward when measured fairly. Next we'll explore how that risk fits into a diversified portfolio.

Do Crypto and Stocks Move Together? Correlation Explained

Crypto’s correlation with stocks has grown over time.

Bitcoin used to move independently from the S&P 500. But now correlations often reach 0.5‑0.9 during market-wide rallies and crashes.

And that trend matters. A tight link means crypto no longer offers a strong hedge during downturns. In 2022, correlation climbed above 0.5 with tech stocks, cutting diversification value.

But crypto can still offer benefits. Adding 1–5% Bitcoin to a 60/40 portfolio boosted returns while barely increasing volatility—WisdomTree reported volatility rose by only 0.83%. Grayscale also found that Bitcoin has historically improved portfolios by reducing overall risk with its low—but variable—correlation to equities.

Institutional entry is part of the story. ETF launches and large corporate holdings pushed Bitcoin closer to stocks. By 2024, correlations hit 0.87 with the Nasdaq during peak buy-in periods.

So while crypto isn’t the perfect diversifier it once was, a small allocation can still enhance long-term portfolios—especially with rebalancing and strategic timing.

How Institutional Investors Are Changing Crypto and Stock Markets

Institutional backing has boosted crypto’s credibility dramatically.

Wall Street giants like BlackRock and Fidelity now offer Bitcoin ETFs. In 2025 alone, those ETFs attracted over $50 billion in new investments. Endowments, hedge funds, and pension funds are buying in, with 59% of surveyed institutions planning to allocate more than 5% of their portfolios to digital assets. That support fuels more growth.

And regulation is catching up. The U.S. passed FIT21 to clarify whether the SEC or CFTC oversees crypto. Congress also passed the GENIUS Act, a strong signal of stablecoin regulation progress. EU’s MiCA rules came into effect in December 2024, creating a uniform framework for crypto service providers.

But it’s not just regulation. Infrastructure has matured too. Institutional-grade custody, on‑chain settlement, and regulated futures and options markets now exist—London’s new GFO‑X derivatives platform being a prime example.

These shifts mean crypto is moving from speculative fringe to institutional-grade asset. Access is smoother, safer, and more mainstream than ever.

Pros and Cons of Investing in Crypto vs Stocks

Here’s a clear comparison of the advantages and drawbacks of each asset class:

Stocks

• Steady, proven growth: The S&P 500 has averaged about 10% long-term returns.
• Intrinsic value: Companies generate revenue, assets, and dividends. That grounds your investment.
• Strong regulation: Investor protections, reporting requirements, and oversight reduce fraud risk.
• High liquidity: Easy to buy and sell during market hours.

Stocks - Drawbacks

• Moderate volatility: Single stocks can swing, and market dips still happen.
• Limited upside: Returns tend to be steady—not explosive like crypto.

Crypto

• Huge upside potential: Some coins have skyrocketed hundreds or thousands of percent.
• Decentralized & fast: Trades 24/7 with no central authority.
• Accessible globally: Anyone with internet and a wallet can join instantly.

Crypto - Drawbacks

• Extreme volatility: Price swings can be massive—even in single days.
• No intrinsic value: Most cryptos don’t generate cash flow or earnings.
• Regulation and security risk: Hacks, scams, and unclear legal frameworks are ongoing concerns.

What’s Next for Crypto and Stocks? Future Trends to Watch

Expect crypto and stocks to both play evolving roles in portfolios.

And right now, crypto is gaining steam. Bitcoin hit an all-time high of ~$118 k in July 2025 on strong ETF inflows and regulatory clarity under the GENIUS and FIT21 acts. More public companies—like MicroStrategy, GameStop, and Sequans—are adding crypto to their balance sheets. Their reserves total over 847,000 BTC, doubling year-over-year.

But macro trends will shape crypto’s future. Analysts from Fidelity expect liquidity, inflation, and interest-rate cuts to drive the next phase, possibly boosting returns despite rising volatility. Veteran advisor Ric Edelman now calls avoiding crypto riskier than including it, and recommends 10–40% allocations depending on risk profile.

And stocks remain central. The S&P 500 could rise ~12% by year-end 2025, driven by tech, AI, and rate cuts. Balance is key; each asset offers different advantages in different scenarios.

Potential Scenarios Ahead:

• Bull case: Continued regulation, ETF inflows, and corporate adoption pushing crypto higher.
• Bear case: Tightened monetary policy hitting both stocks and crypto.
• Middle ground: Stocks offer steady gains; crypto adds high-risk alpha.

This shows why blending stable equities with select crypto exposure may offer both growth and resilience over the long term.

Should You Invest in Crypto, Stocks, or Both? Final Thoughts

Crypto delivers massive upside with high risk. Stocks offer steady returns with less drama.

Both asset classes can work in a long-term portfolio, but they serve different purposes. Stocks build wealth slowly, backed by profits and strong regulation. Crypto moves fast—up or down—with unmatched potential but serious volatility.

And that’s why balance matters. Most investors don’t need to choose one over the other. A smart mix—like 90% in diversified stocks and 10% in Bitcoin—can boost returns without wrecking your risk profile.

But know your goals. If you want growth with stability, stocks do the job. If you can handle the swings, crypto adds alpha. Just don’t go all-in on hype—or fear.

Markets change. So review your mix, stay informed, and focus on what fits your long-term plan. In the end, it’s not about timing the perfect asset. It’s about building a portfolio that can grow and survive across cycles.