Retirement-account holders alternated between terror and relief in recent weeks as the S&P 500 -- the index that most people's 401(k)s track -- nearly entered bear market territory before recovering all of the losses.

Cryptocurrencies suffered similar volatility, but a recent surge in the price of bitcoin has left the signature digital asset up 15% so far this year. The S&P 500, by contrast, is essentially flat in 2025.

A wider disparity stretches back to last spring. Over the past year, the price of bitcoin has soared 54%, while the value of the S&P 500 has jumped 11%.

The trend poses a question for retirement portfolios: Should you add crypto?

MORE: Bitcoin hit a record high. Here's why.

The choice, analysts said, comes down to an account holder's tolerance for risk. Crypto promises potentially large gains but threatens similarly significant losses, since the asset frequently experiences price swings, they said.

A small holding could bear outsized returns while risking only limited damage in the event of a downturn, analysts told ABC News, but they cautioned against a large investment of retirement funds.

"There's potential for growth, but there's also big downside risk. So it really depends on how much risk the individual is willing to bear," Reena Aggarwal, professor of finance and director of the Georgetown Psaros Center for Financial Markets and Policy, told ABC News.

In recent weeks, some major financial firms and a federal agency have signaled a friendlier posture toward retirement investment in crypto.

Last month, financial services giant Fidelity launched a crypto IRA account, allowing investors to put retirement funds directly into popular cryptocurrencies bitcoin, ethereum and litecoin.

The Department of Labor on Wednesday rescinded previous guidance urging asset managers to exercise "extreme care" before investing retirement funds in cryptocurrency.

Instead, the agency said in a statement it would strike a neutral stance toward those who consider "the inclusion of cryptocurrency in a plan's investment menu is appropriate."

Such developments mark the latest signs of mainstream adoption for crypto. Regulatory approval of Bitcoin ETFs -- Exchange-Traded Funds – last year helped send the price of the world's largest cryptocurrency soaring.

Institutional adoption of cryptocurrency establishes greater clarity and trust in the market, but the assets remain highly volatile, Aggarwal said.

"Institutionalization does make things less risky because it brings transparency," Aggarwal said, while cautioning that there are still "huge movements in price."