Crypto Market Rebounds 45% to $3.31 Trillion by July 2025

The crypto market entered 2025 with a significant slowdown after peaking at $3.7 trillion in Q4 2024. Bitcoin, which had reached $109,000 and a $2.1 trillion market cap, experienced a major drawdown but rebounded to a new all-time high of $112,000 by July 1. This rebound was supported by steady institutional buying from Strategy and Metaplanet. The total market cap fell to $2.4 trillion mid-cycle before recovering to $3.31 trillion by July 1.

Macroeconomic pressures, including the Fed holding rates steady at 4.25%-4.5% and inflation at 2.4%, added to market volatility. Geopolitical tensions, such as U.S.-China tariffs and Middle East unrest, kept investors on edge. Despite these challenges, the crypto market showed resilience, backed by regulatory clarity and rising demand from emerging markets.

Investor sentiment was highly volatile, with the Fear & Greed Index plunging from 94 in December to 10 in March but recovering to 64 by July. However, sentiment remained range-bound between 40 and 65, signaling lingering caution in the market.

Bitcoin's performance was marked by a 12% gain in price, reaching $108,800 by June 30. Exchange reserves decreased to 2.44 million BTC, indicating higher accumulation. ETF inflows slightly decreased to $4.60 billion monthly, while active addresses increased to 900K, showing demand. Institutional and government accumulation, including Strategy, Metaplanet, and different countries’ governments adding BTC, contributed to Bitcoin's resilience. Geopolitical dips caused by wars like Iran-Israel and US tariff threats caused brief slides.

Ethereum's price declined by 27%, reaching $2,524 by June 30. Exchange reserves slightly decreased to 19.02 million ETH, showing lesser accumulation. ETF inflows into Ethereum increased massively by 10x, reaching $1.16 billion monthly. Active addresses slightly decreased to 356K. Continued protocol upgrades, stablecoin, and DeFi activity remained strong. Institutional flows into ETH ETFs increased massively, but the price stayed suppressed due to geopolitical factors.

Layer-1 tokens like SOL, ADA, and AVAX saw bright growth led by ecosystem expansion and higher ETF odds. Layer-2 tokens like OP, ARB, and MATIC experienced strong gains as scaling adoption increased. Meme coins like DOGE and SHIB were volatile but fetched attention, especially DOGE, with rising ETF odds. AI tokens like FET, RNDR, and AGIX aligned with AI and crypto crossover. Gaming/Metaverse tokens like SAND, AXS, and GALA witnessed modest growth. DeFi tokens like UNI and AAVE gained from on-chain activity and yield demand.

Monero (XMR) and Hyperliquid (HYPE) were the top gainers, with XMR surging by 71% due to heightened demand for privacy-focused cryptocurrencies and HYPE growing by 74% due to enhanced liquidity and user engagement. Bitcoin SV (BSV) and Pi Network (PI) were the top losers, with BSV dropping by 45.23% due to regulatory uncertainties and declining investor confidence, and PI dropping by 36% due to weak market sentiment and failure to meet adoption expectations.

The stablecoin market saw a significant increase in overall market cap, reaching $251.55 billion by June. Stablecoin market cap share jumped to 8.9%, and on-chain transaction volume increased to $1.39 trillion. USDT and USDC remained dominant, but smaller players like PYUSD, RLUSD, and DAI slightly expanded their market share. Ethereum continued to lead as the primary stablecoin settlement layer, though TRON and Solana gained traction as emerging launchpads.

US Bitcoin Spot ETF recorded a cumulative net inflow of $48.97 billion, with total net assets reaching $134.11 billion by June 30. Bitcoin ETF holdings represent 6.27% of the total Bitcoin market cap. US Ethereum Spot ETF saw a cumulative net inflow of $4.21 billion, with total net assets standing at $10.32 billion by June 30. Ethereum ETF holdings equal 3.42% of the Bitcoin market cap. In-kind redemption mechanisms are gaining popularity for assets like Dogecoin (DOGE) and Aptos (APT). There are currently 72 altcoin ETF applications pending regulatory approval.

The DeFi sector saw a rise in Total Value Locked (TVL) from $86 billion to $112 billion by June 2025, signaling increased adoption and capital inflow. AAVE dominated the lending market with over 60% share and $16 billion+ in borrows. The AAVE V3 protocol continued to attract collateral, and anticipation around the V4 launch further boosted confidence. DEXs like Uniswap, Jupiter, and PancakeSwap saw increased network activity, resulting in higher fees and supporting DeFi’s rebound. HYPE’s fee-free DEX enhanced user activity across multiple chains, and lending protocols from HYPE also gained traction during H1 2025. AAVE lending yields ranged between 5% to 8% APY, down from 2024 due to higher TVL and reduced risk premiums.

In H1 2025, nearly 334 – 344 hacks caused $2.2 – $2.5B losses, including Bybit’s $1.5B breach. ProCap and Grant Cardone’s firms entered the Bitcoin treasury race, intensifying corporate crypto adoption. The U.S. SEC signaled openness to in-kind redemptions for crypto ETFs, fueling speculation about future altcoin fund approvals. Norway is exploring a crypto-mining ban, while a different country, Kazakhstan, is exploring a national crypto reserve. Metaplanet and Strategy aggressively expanded their BTC holdings, marking a corporate treasury shift toward Bitcoin as a long-term reserve asset. Ripple dropped its cross-appeal in the SEC case, paving the way for a near-end to the multi-year legal battle. World Liberty Financial (WLFI), backed by Trump family ties, expanded USD1 stablecoin on BNB Chain, boosting RWA and DeFi interest.

Despite the ups and downs, H1 2025 proved the resilience of the crypto market. Bitcoin surged to a new high of $112K, and the overall market rebounded to $3.31 trillion. If bullishness increases, Bitcoin may hit $180,000 – $200,000, and Ethereum $5,000 – $6,000, by year-end 2025. This growth could be fueled by future Fed rate cuts, ETF inflows, and the Stablecoin Payment Act. DeFi is also regaining momentum with $112B in TVL, and institutional interest keeps rising. With altcoin ETFs on the horizon and big players entering the space, H2 2025 could set up for a major breakout, potentially taking the total crypto market cap toward the $4 – $5 trillion mark.