Is crypto riskier than stocks during a recession?

Yes. Crypto tends to show higher volatility and deeper drawdowns than stocks during recessions. Digital assets like Bitcoin and Ethereum often fall harder and rebound faster, thereby amplifying market cycles. Stocks, meanwhile, are more regulated, less volatile, and supported by fundamentals like earnings.

Has Bitcoin ever outperformed the stock market in a recession?

In short, yes. For instance, between March 2020 and March 2021, Bitcoin surged over 1,020% while the S&P 500 rose around 54%. This outperformance followed a sharp crash during the initial COVID panic. The rebound was fueled by stimulus, risk appetite, and growing crypto adoption.

Can crypto act as a hedge in a recession?

Not consistently. Bitcoin has shown increased correlation with equities during recent downturns, especially in 2020 and 2022. It may act as a hedge in some macro conditions, but it's not yet a reliable safe-haven like gold. A true decoupling from traditional markets could eventually strengthen crypto’s role as a more reliable macro hedge.

What’s the best way to balance crypto and stocks during a recession?

Consider keeping crypto as a small percentage of your portfolio — typically under 10%. Meanwhile, maintain core exposure to diversified stocks, including defensive sectors. Also, you might want to hold some liquid reserves to avoid forced selling and rebalance periodically to manage risk.