Q1 2025 Crypto Market Review: Total market capitalization falls to $2.8 trillion

In the first quarter of 2025, the cryptocurrency market suffered a heavy blow, contrasting sharply with the frenzied market conditions at the end of last year. The market's total market capitalization fell by 18.6% in the first quarter to $2.8 trillion, having briefly touched a high of $3.8 trillion on January 18. Meanwhile, investment activity also noticeably decreased, with the average daily trading volume declining significantly by 27.3% to $146 billion.

As the market is in a slump, Bitcoin's dominance has further strengthened, reaching 59.1% by the end of the first quarter, the highest level since early 2021, mainly because altcoins bore the brunt of the fall. Although Bitcoin reached a historical high of $106,182 in January, it had fallen back to $82,514 by the end of the quarter, with a drop of 11.8%.

Here are the eight key points of the cryptocurrency market in the first quarter of 2025:

1. The total market capitalization of cryptocurrencies fell by 18.6%, retreating from a high of $3.8 trillion to $2.8 trillion.

2. Bitcoin's dominance increased to 59.1%

3. Bitcoin's quarterly fall is 11.8%, underperforming gold and U.S. Treasuries.

4. The price of Ethereum fell from $3,336 to $1,805, erasing all gains for 2024.

5. The meme coin craze has subsided, with the daily number of new tokens on the Pump.fun platform plummeting by 56.3%.

6. The spot trading volume of centralized exchanges has dropped to $5.4 trillion, a 16.3% decrease compared to the previous period.

7. Solana continues to lead in on-chain DEX trading, accounting for 39.6% of the total trading volume in the first quarter.

8. The total locked value of cross-chain DeFi ( TVL ) has evaporated by 4.89 billion USD, a decrease of 27.5%.

Bitcoin's Dominance Rises, Stablecoins Benefit

Bitcoin's market dominance increased by 4.6 percentage points in the first quarter of 2025, reaching 59.1% at the end of the quarter, the highest level since early 2021. This is mainly due to Bitcoin's relatively strong performance during the market fall, while altcoins suffered heavy losses.

Stablecoins also benefit from the market fall as investors seek safe havens. Tether (USDT)'s market share slightly increased to 5.2%, while USDC surpassed Dogecoin (DOGE) to rise to seventh place.

In contrast, Ethereum ( ETH )'s market share has significantly dropped by 3.9 percentage points to 7.9%, the lowest level since the end of 2019. The market share of other smaller tokens has also decreased by 3.5 percentage points to 15.7%. Among the major tokens, only XRP and BNB have basically maintained their market share.

Asset Performance Comparison: Gold Leads, Cryptocurrencies Generally Fall

In the first quarter of 2025, major assets showed mixed performance. Gold became the best-performing asset class with an 18% increase. At the same time, risk assets, including Bitcoin, generally fell, with the Nasdaq and S&P 500 indices decreasing by 10.3% and 4.4%, respectively.

It is worth noting that the dollar index ( DXY ), which is usually inversely correlated with risk assets, also fell by 4.6%, possibly due to uncertainties in U.S. tariff policies. The Japanese yen and euro appreciated against the dollar by 5.2% and 4.5%, respectively, with part of the yen's appreciation attributed to the unwinding of arbitrage trades following the Bank of Japan's interest rate hike in January.

Ethereum sees a significant fall, erasing all gains of 2024

Ethereum performed poorly in the first quarter of 2025, with its price plummeting from $3,336 to $1,805, a quarterly fall of as much as 45.3%. This decline erased all gains made in 2024, bringing the price back to levels seen in 2023. In contrast, major tokens like Bitcoin, Solana, XRP, and BNB experienced much smaller declines.

The average daily trading volume of Ethereum has also decreased, dropping from $30 billion in the fourth quarter of 2024 to $24.4 billion this quarter. It is worth noting that days of soaring trading volume are often accompanied by significant falls in Ethereum prices.

The tide of Meme coins recedes, and the number of new tokens significantly decreases

In early 2025, taking the inauguration of Trump as an opportunity, the sudden issuance of politically related Meme coins such as TRUMP and MELANIA sparked a wave of Meme coin frenzy. The number of newly deployed tokens on the Pump.fun platform once reached a historical high of 72,000 per day.

However, this wave was soon ended by the LIBRA token incident promoted by the President of Argentina. LIBRA's market capitalization fell sharply from $4.6 billion to $221 million in a short period, raising market awareness towards Meme coins.

Since then, the activities on the Pump.fun platform have significantly declined, with the number of newly deployed tokens dropping by over 56.3% from the peak in January to 31,000 by the end of the quarter. The proportion of tokens that successfully "graduated" also fell from 1.4% in January to 0.7% by the end of the quarter.

Centralized exchange trading volume declines, Binance continues to lead

In the first quarter of 2025, the top 10 centralized exchanges (CEX) had a spot trading volume of $5.4 trillion, a 16.3% decrease compared to the previous quarter. Binance remains the most dominant spot trading platform, with a market share of 40.7% in March. Nevertheless, its trading volume in March significantly dropped from over $1 trillion in December of last year to $588.7 billion.

HTX is the only one of the top 10 exchanges to achieve growth in the first quarter, with a trading volume increase of 11.4%. Other major exchanges experienced a fall in trading volume ranging from 1.8% to 34.0%. The South Korean exchange Upbit saw the largest fall, with trading volume plummeting by 34% from $561.9 billion in the previous quarter to $371 billion.

It is worth noting that Bybit experienced a significant hack in February, resulting in a month-on-month trading volume fall of 52.4%, from 178.2 billion dollars to 84.7 billion dollars.

DEX Trading Landscape: Solana Leads, New Public Chains Rise

Continuing the trend into the end of 2024, Solana continues to dominate trading on decentralized exchanges (DEX), with a market share of 39.6% in the first quarter of 2025. Its trading volume increased by 35.3% from the previous quarter's $217 billion to $293.7 billion.

In January, driven by the political-related Meme coin craze, Solana once occupied 52% of on-chain DEX trading, with a trading volume exceeding $184.8 billion, marking a historic high. This caused Ethereum's market share to fall below 20% for the first time.

However, as the Meme coin craze subsides, Ethereum regained the top spot in March with a market share of 30.1%, while Solana fell to 23.4%.

It is worth noting that the emerging public chains Sonic and Berachain squeezed into the top 10 in DEX trading volume in March, replacing Optimism and Polygon. However, over the entire quarter, the latter two still maintain their lead.

The DeFi locked volume has dropped significantly, and new public chains are rising rapidly.

In the first quarter of 2025, the total locked value of cross-chain DeFi ( TVL ) showed a downward trend, decreasing by 27.5% from $177.4 billion at the end of 2024 to $128.6 billion. This is mainly due to the significant depreciation of altcoin values.

The TVL loss of Ethereum is particularly severe, with its dominance falling from 63.5% at the beginning of the year to 56.6% at the end of the quarter. Ethereum's TVL decreased by 35.4%, from 11.26 billion dollars to 7.27 billion dollars.

The TVL of Solana and Base has also seen a significant decline, dropping by 23.5% and 15.3% respectively, mainly due to the sharp fall in the prices of SOL and ETH. Nevertheless, the TVL market share of these two networks has still seen a slight increase.

It is noteworthy that Berachain, which just launched on February 6, has rapidly risen within just two months, with a TVL of 5.2 billion dollars at the end of the quarter, ranking sixth. Among them, the Boyco pre-deposit treasury alone attracted about 2.3 billion dollars in funds, providing strong support for its liquidity on the first day.