The cryptocurrency market experienced a significant downturn in the first quarter of 2025, with the total market capitalization dropping by -18.6% to $2.8 trillion. Bitcoin’s dominance almost hit 59.1%. Its price, though, fell 11.8% to end at $82,514 although it hit an all-time high of $106,182 in January. Ethereum’s market share has fallen under 20% for the first time ever. Its price has dropped 3.9 pp, lowering its share of the overall market down to 7.9%—its lowest level since late 2019. Solana has done pretty well in the DEX universe, commanding around 87% market share. At the same time, centralized exchanges (CEX) have been going through a slump in spot trading volume. As a result, gold became the best-performing asset, outperforming cryptos all this time-market pullback combined.
Bitcoin's Market Lead and Price Correction
Bitcoin’s market dominance reached 59.1% in the first quarter of 2025. This tremendous growth underscores its position as the dominant cryptocurrency. Climate investors are rushing into Bitcoin because it’s the most stable. This increase in popularity shows a trend toward safety in the midst of the overall market’s turbulence.
Even with its larger overall dominance, Bitcoin’s price faced a significant correction throughout the quarter. In January, it reached a historic peak of $106,182. Yet by the end of March, the price had plummeted 11.8%, all the way down to $82,514. His Twitter price movement, of course, only demonstrates how jumpy the cryptocurrency market is. Macroeconomic factors play a large role in investor sentiment.
This price drop came in the face of very promising news and increased institutional interest in the cryptocurrency. It indicates that profit-taking and general market corrections were a major force in driving the price downwards.
Ethereum's Declining Market Share
Ethereum, the second-largest of the cryptocurrencies by market cap, continued to struggle in the first quarter of 2025. It was the first time that its market share fell below 20%. Such relocation could be a harbinger of a hard reconfiguration of the competitive playing field of the crypto-state.
The price of Ethereum plummeted even further during the quarter, losing -3.9pp in value. The length and depth of the price drop indicates just how badly Ethereum was being hammered. The drop in market share indicates it ought to have lost ground to alternative blockchain platforms.
Ethereum’s share of the overall market has dropped to its lowest level since late 2019, just 7.9%. Much of this decline can be attributed to the growth of competing layer-1 networks. The growing interest in decentralized finance (deFi) applications on competing blockchain ecosystems has fueled this trend.
DEX and CEX Performance
Solana became slugger in the decentralized exchange (DEX) trading arena in Q1 2025. Its market share of 39.6% shows its increasing adoption amongst traders who are looking for more efficient trading methods that are faster and cheaper.
During that impressive month in January, the Solana blockchain was responsible for 52% of all transactions across the top 12 blockchains. This milestone celebrates its increasing adoption, usage, and network activity. This excitement is fueled, in part, by Solana’s amazing scale. Its low transaction fees ensure that it remains an attractive platform for DeFi applications.
Centralized exchanges (CEX) still saw a healthy amount of trading volume throughout the quarter. The 10 largest centralized exchanges (CEXs) recorded a spot trading volume of US$5.4 trillion. This massive number is actually a month-on-month drop of 16.3%. The average daily trading volume fell off a cliff in Q1, declining 27.3% quarter over quarter to $146 billion. Contrary to the trend, in Q1 2025 trading volume skyrocketed by 35.3%, increasing from $217 billion in Q4 to a staggering $293.7 billion.
Broader Market Trends and Alternative Investments
As first quarter 2025 total cryptocurrency market capitalization experiences a sharp decline of 18.6%. It did finish the quarter at $2.8tr. This decline is a testament to an overall market correction and macroeconomic uncertainties that affected investor confidence throughout the entire cryptocurrency spectrum.
The entire market capped at a local high of $3.8 trillion on January 18th, only two days before the long awaited Donald Trump’s inauguration. This is illustrative of the effect that major political and economic news can have on the valuation of the cryptocurrency markets.
With everything going wrong in the cryptocurrency world, gold had an incredible Q1 2025. Once again, it surged to be the best performing asset class, registering an astounding return of 18.0%. This underlines the deep investor proclivity to flee to safe-haven asset during times of economic uncertainty and market dislocation.
