(Bloomberg) --

The world’s largest cryptocurrency has been a relative snoozer six weeks into 2022. 

Based on five years of price movements, Bitcoin has moved more than one standard deviation from its average in either direction just five times so far this year, according to data compiled by Bloomberg. That compares to 12 times for the tech-heavy Nasdaq 100 index. The only other time that’s happened in the last five years was in 2020, when the onset of the pandemic roiled equity markets. 

Growing jitters over how aggressively the Federal Reserve will need to tighten policy to combat decades-high inflation have fueled the historic volatility in richly valued tech stocks. Bitcoin hasn’t been battered to the same degree, in part because a large amount of leverage was drained from markets amid the cryptocurrency’s 50% drawdown from November to mid-January, according to Miller Tabak + Co.’s Matt Maley. 

“At its worst level, Bitcoin was down 50% while the Nasdaq 100 was down 15% at its lowest level -- 50% declines have a way of wringing out a lot of leverage in an asset,” said Maley, the firm’s chief market strategist. “Since there is likely still a lot of leverage in many of the big Nasdaq 100 stocks, it makes sense that the volatility would be much higher.”

The Nasdaq 100 has dropped nearly 13% so far in 2022, outpacing an 8% decline in Bitcoin. The tech-heavy index has proven more volatile than Bitcoin this year despite having fewer trading days (cryptocurrencies trade all weekend long). 

There’s still a tight linkage between the two asset classes. Bitcoin’s 40-day correlation coefficient with the Nasdaq 100 stands near all-time highs, according to data compiled by Bloomberg.

January’s brutal Bitcoin selloff -- which sent prices below $33,000 -- appears to have left a lasting mark on risk appetite. Total spot volume on crypto exchanges slumped to $1.8 trillion in January, a decline of more than 30% from the previous month, according to a report from CryptoCompare.

Waning turbulence and trading volume could spell trouble for crypto markets, where volatility is part of the appeal. A big catalyst for Bitcoin’s 2017 bull run was the fact that stocks were fairly boring, according to Kraken’s Juthica Chou. The Nasdaq 100 posted just 11 moves of one standard deviation or greater in 2017 compared Bitcoin’s tally of 92.

“Certainly as there’s opportunity in the broader market, that will take away a little bit from allocating capital to crypto,” Chou, head of OTC options trading at Kraken, said on Bloomberg’s “QuickTake Stock” broadcast. “At the end of the day, Bitcoin is the size of one large tech company. It’s not necessarily going to be able to produce the returns that some these larger, high-frequency firms may look at.”

©2022 Bloomberg L.P.