Crypto Industry Faces Sharp Decline in Q1 2025 After Record-Breaking Highs

The crypto industry experienced a significant downturn in the first quarter of 2025, with the total market capitalization falling 18.6% to close at $2.8 trillion, according to CoinGecko’s latest Q1 report.

This decline follows a period of euphoria in late 2024, when the market briefly touched $3.8 trillion on January 18, just before Donald Trump’s presidential inauguration.

The Q1 slump affected investor activity substantially, with average daily trading volumes dropping 27.3% quarter-on-quarter to $146 billion. This represents a sharp contrast to the $200.7 billion daily average recorded in Q4 2024.

Crypto Industry Turmoil: Winners and Losers

While the entire market took a hit, Bitcoin reinforced its position as the dominant cryptocurrency. BTC’s market share rose by 4.6 percentage points to reach 59.1% by the end of Q1—levels not seen since early 2021.

Though Bitcoin hit a fresh all-time high of $106,182 in January, it retreated to $82,514 by quarter-end, registering an 11.8% decline.

Ethereum was hit particularly hard, with its price plummeting from $3,336 to $1,805, representing a 45.3% decrease within the quarter. This steep drop effectively erased all of ETH’s gains from 2024. Ethereum’s market dominance fell by 3.9 percentage points to 7.9%, its lowest level since late 2019.

Stablecoins benefited from the market turbulence as investors sought stability. Tether (USDT) increased its market share slightly to 5.2%, while USDC regained its #7 spot, replacing Dogecoin.

Centralized and Decentralized Exchange Performance

Spot trading volume on centralized exchanges (CEXs) hit $5.4 trillion in Q1 2025, down 16.3% from the previous quarter. Binance maintained its position as the dominant spot CEX with a 40.7% market share, despite seeing its monthly trading volume drop below $600 billion in March, compared to over $1 trillion in December.

In the decentralized exchange (DEX) landscape, Solana continued its dominance from late 2024, accounting for 39.6% of all DEX trades in Q1. Solana’s share peaked at an impressive 52% in January, driven by the “political memecoin” trend led by tokens like $TRUMP.

The total value locked (TVL) in multichain DeFi projects fell by 27.5% in Q1, from $177.4 billion to $128.6 billion. Ethereum lost 35.4% of its TVL, dropping from $112.6 billion to $72.7 billion.

A notable newcomer, Berachain, launched on February 6, quickly grew to $5.2 billion in DeFi TVL by the end of Q1, securing the sixth-largest TVL share in the market.

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