Bitcoin’s market share rose to 59.1% despite falling 11.8%.
Ethereum’s 2024 gains wiped out in Q1 2025.
DeFi TVL fell 27.5% across multichain platforms.
The global cryptocurrency market started 2025 with optimism, fuelled by expectations of favourable policy shifts under Donald Trump’s presidency and a strong rally across meme coins.
But those hopes have since been dashed. According to CoinGecko’s latest quarterly report, crypto’s total market capitalisation fell 18.6% in Q1 2025, wiping out $633.5 billion in value.
Trading volumes also took a hit. The report shows that average daily trading volume fell 27.3% compared to the previous quarter. Spot trading on centralised exchanges declined 16.3%, a drop that was partly attributed to the Bybit hack earlier this year.
Despite signs of strength in early January, recession concerns and fragmented investor interest led to a broad sell-off across digital assets.
Bitcoin outperforms altcoins but still falls 11.8%
Bitcoin retained its dominance over the broader market in Q1, accounting for 59.1% of the total crypto market cap — its highest level since 2021.
This shift highlights how investors have treated Bitcoin as a relatively more stable asset compared to altcoins during uncertain periods.
However, Bitcoin itself was not immune to losses. It declined 11.8% during the quarter and underperformed traditional safe havens like gold and US Treasury bonds.
The report also noted that Trump’s newly imposed tariffs triggered volatility in the bond market, impacting yields — a key metric closely linked to digital asset flows.
Ethereum saw an even sharper reversal. It gave up all of its 2024 gains, returning to levels last seen before its Shanghai upgrade. The report attributed this trend to declining decentralised finance (DeFi) activity and persistent concerns around gas fees and scalability.
DeFi TVL and Solana activity decline sharply
Multichain DeFi protocols suffered significantly, with total value locked (TVL) falling 27.5% over the three-month period.
Solana, which led the decentralised exchange (DEX) trading space during the meme coin frenzy in January, saw its own TVL drop by more than 20%.
CoinGecko’s data indicates that market excitement around Trump-themed tokens, particularly the TRUMP coin on Solana, sparked a temporary spike in transaction volumes. However, this activity failed to sustain investor interest beyond January.
The LIBRA scandal, which emerged shortly after, added further pressure on altcoin sentiment and liquidity.
Despite these setbacks, Bitcoin exchange-traded funds (ETFs) recorded $1 billion in fresh inflows in Q1.
But the total assets under management (AUM) across these ETFs still fell by nearly $9 billion due to declining prices, highlighting the gap between investment inflows and market returns.
Structural concerns deepen
While some data points suggested limited resilience, nearly every positive trend in the report was accompanied by a downside risk.
The report shows that centralised exchanges, stablecoin volumes, and DeFi applications all registered lower activity in February and March. Many projects lost traction as macroeconomic concerns mounted and investor caution grew.
CoinGecko noted that the first quarter of 2025 represents one of the most challenging periods for crypto since the FTX collapse in late 2022.
The report reflects broader market concerns that the crypto sector, despite structural improvements in infrastructure and compliance, remains deeply vulnerable to global economic shocks.
As recession fears take hold and regulatory uncertainties continue to loom in major markets, the path forward for crypto in the coming months remains highly uncertain.
Although Bitcoin’s rising market share signals a flight to perceived safety, the broader market may need more than optimism and meme coin rallies to recover from this quarter’s losses.
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