The crypto market experienced significant fluctuations in the first quarter (Q1) of 2025, starkly contrasting to the highs of late 2024. Following a surge that saw the total market cap touch $3.8 trillion in January, the market stumbled, closing the quarter at $2.8 trillion—a decline of 18.6%. This downturn has led to a notable drop in trading volumes across exchanges, reflecting increased caution among investors.
Bitcoin Strengthens Dominance Despite Market Volatility
According to a recent report by CoinGecko, the average daily trading volume fell by 27.3% quarter-on-quarter to $146 billion, as investor activity waned amidst the price volatility.
Bitcoin (BTC), however, managed to strengthen its dominance during this period, ending Q1 with a market share of 59.1%, a level not seen since early 2021. After hitting a new all-time high of $109,000 in January, Bitcoin’s price retreated to $82,514 by the end of March, representing an 11.8% decline.
In contrast, altcoins bore the brunt of the market downturn. Ethereum (ETH), for instance, experienced a 45.3% drop from $3,336 to $1,805, marking a return to levels last seen in 2023. This underperformance was particularly evident as Ethereum’s dominance fell to 7.9%, its lowest since late 2019.
Amidst the market’s volatility, stablecoins emerged as a safe haven for investors. Tether (USDT) saw a slight increase in its market share to 5.2%, while USD Coin (USDC) regained its position as the seventh largest cryptocurrency, replacing Dogecoin (DOGE).
Record Volume Drops For Crypto Exchanges
Per the report, the top ten centralized exchanges (CEXs) recorded a total spot trading volume of $5.4 trillion in Q1, a decrease of 16.3% from the previous quarter.
Binance maintained its position as the leading spot exchange, with a 40.7% market share, although its trading volume fell sharply to $588.7 billion in March, down from over $1 trillion in December. In contrast, HTX was the only exchange in the top ten to report an increase in volume, rising by 11.4%.
Notably, Bybit suffered the largest month-on-month decline, plummeting by 52.4% after a major security breach in February. Upbit also faced significant challenges, with trading volumes dropping 34.0% to $371 billion.
In the decentralized exchange (DEX) sector, Solana emerged as the dominant player, achieving a market share of 39.6% in Q1.
The platform’s growth was fueled by a surge in on-chain trades, particularly during the “political memecoin” frenzy surrounding the TRUMP token, which accounted for over $184.8 billion in trading volume, but as the memecoin trend waned, Ethereum regained some ground in March, capturing a 30.1% market share compared to Solana’s 23.4%.
Adding to the market’s challenges during the first quarter of the year, the total value locked (TVL) in multi-chain DeFi projects also saw a significant decline, falling 27.5% to $128.6 billion by the end of March. Ethereum experienced a significant loss, with its TVL falling from $112.6 billion to $72.7 billion, a decrease of 35.4%.
Featured image from DALL-E, chart from TradingView.com