Crypto Market Stumbles in Q1 2025: Bitcoin Down 6.49%, Ethereum Plummets 37.98%

In the first quarter of 2025, the cryptocurrency market experienced a challenging period, with both Bitcoin (BTC) and Ethereum (ETH) facing significant declines. Bitcoin's price dropped by 6.49%, marking its weakest start since 2020. Ethereum fared even worse, plummeting by 37.98%, which was its most disappointing opening quarter since 2018. These downturns are unusual, as the first quarter typically sees substantial growth for these assets.

Ethereum's struggles were further highlighted by the decrease in the ETH/BTC ratio, indicating a lack of momentum for Ethereum against Bitcoin in a post-halving year. Historically, Ethereum has recorded an average gain of 77% in the first quarters, but this year it suffered its sharpest quarterly markdown since 2018, spiraling close to 46% lower. The approximately $5 million Ethereum ETF also experienced a seventeen-day streak of outflows, which only ended on Friday, March 27.

Bitcoin, on the other hand, faced uncertainty amid economic concerns. Its upward drift to $108,000, propelled by bull sentiments over Trump’s presidential tenure and escalating trade conflicts, feels like history. Bitcoin struggled this year, finishing 2025 Q1 with its worst first-quarter performance since 2018 after falling to $82,000. The flagship asset, which had risen to $88,000 in its rebound a few days ago, is now retreating into the lower $80,000 range. BTC is on course for a 12.18% decline with its current trajectory, as its performance in the last two months negates its positive streak at the start of the year. Amidst rising trade tensions, inflow streaks into Bitcoin ETFs have notably dwindled this year, so far being capped at ten days.

Looking ahead to the second quarter, some analysts believe that Ethereum's price drop will be sustained in the long run, which could mean some positive signals for Q2. Ethereum is projected to drop further in the short run, yet Bitcoin’s over-performance is bound to motivate Bitcoin to break the trend. Positive indicators of investor behavior are beginning to surface. Most notably, investors have removed over 30,000 BTC from exchanges within a week. This typically suggests a move away from short-term trading towards a longer-term strategy of holding. The crash of ETH may, in theory, start reversing pretty soon, particularly given that historically, Ethereum and Bitcoin’s performance seems to improve in the second quarter instead of the first. Nonetheless, it must be remembered that a lot of volatility in the crypto markets is also likely with the Trump tariff announcement on April 2 and the US inflation data dropping on April 10.