Q1 2025 Crypto Assets Market Analysis: Overall Decline with Bitcoin's Status on the Rise

At the beginning of 2025, the Crypto Assets market experienced a significant correction, in stark contrast to the bull market at the end of 2024. In the first quarter, the total market capitalization of Crypto Assets fell by 18.6% to $2.8 trillion, having briefly reached a high of $3.8 trillion on January 18. Market activity also decreased, with the average daily trading volume declining by 27.3% to $146 billion.

Against the backdrop of a weakening overall market, Bitcoin has strengthened its dominant position. By the end of the first quarter, Bitcoin's market capitalization reached 59.1%, a new high since early 2021, mainly because small coins bore the brunt of the downward pressure. Although Bitcoin reached a historical high of $106,182 in January, it fell back to $82,514 by the end of the quarter, a decrease of 11.8%.

Major Market Trends

1. Bitcoin's Dominance Increases: Bitcoin's market capitalization share has risen by 4.6 percentage points to 59.1%, the highest level in nearly four years.

2. Stablecoin Benefits: During market downturns, investors turn to stablecoins for hedging. USDT's market share slightly rises to 5.2%, and USDC returns to the top ten Crypto Assets.

3. Ethereum Weakness: The price of ETH plummeted from $3,336 at the beginning of the quarter to $1,805, a quarterly decline of 45.3%, erasing the gains for the entire year of 2024.

4. The Altcoin Market Cools Down: The political-related Meme coin craze quickly cooled after the LIBRA coin incident in Argentina, with a significant decrease in the issuance of new tokens.

5. Total DeFi Lock-up Volume Decline: The total lock-up volume of multi-chain DeFi (TVL) decreased by 27.5%, from 177.4 billion USD to 128.6 billion USD, mainly affected by the depreciation of altcoins.

6. Changes in Exchange Landscape: Centralized exchange (CEX)'s spot trading volume decreased by 16.3% month-on-month to $5.4 trillion. In terms of decentralized exchanges (DEX), Solana continues to maintain its leading position with a quarterly market share of 39.6%.

Performance of Various Assets

• Bitcoin: Quarterly decline of 11.8%, underperforming against gold ( +18.0% ) and US Treasury bonds.
• Ethereum: Plummeted by 45.3%, performing significantly worse than other major Crypto Assets.
• Stock Market: The Nasdaq and S&P 500 fell by 10.3% and 4.4%, respectively.
• Foreign Exchange: The US dollar index fell by 4.6%, while the Japanese yen and euro rose against the dollar by 5.2% and 4.5%, respectively.

Exchange Dynamics

• A leading trading platform still maintains its dominant position in the spot CEX market, with a market share of 40.7% in March.
• HTX is the only one of the top ten exchanges to achieve a trading volume increase in the first quarter, with a growth rate of 11.4%.
• A certain exchange in South Korea experienced the largest decline, with trading volume decreasing by 34.0% compared to the previous period.
• After a major security incident in February, a certain trading platform saw a 52.4% month-on-month drop in trading volume.

DEX Market Landscape

• Solana continues to dominate DEX trading with a market share of 39.6% in the first quarter.
• In January, driven by politically related Meme coins, trading on the Solana chain once accounted for 52% of the market share.
• In March, Ethereum reclaimed the top spot in DEX trading with a market share of 30.1%, while Solana fell to second place with 23.4%.
• The emerging public chains Sonic and Berachain entered the top ten in DEX trading in March.

DeFi Ecosystem

• Ethereum DeFi TVL fell by 35.4%, from $112.6 billion to $72.7 billion, with its dominance dropping to 56.6%.
• The TVL of Solana and Base decreased by 23.5% and 15.3% respectively, but their market share slightly rose.
• The new public chain Berachain is rapidly rising, with a TVL of 5.2 billion dollars at the end of the quarter, ranking as the sixth largest DeFi ecosystem.

Overall, the cryptocurrency market experienced significant adjustments in the first quarter of 2025, with Bitcoin relatively resilient in the overall decline and strengthening its dominant position, while altcoins and the DeFi ecosystem suffered substantial impacts. There have also been some noteworthy changes in market structure and participant behavior.