Q1 is the worst quarter in crypto history:

In a crypto market commentary released on April 16, asset manager Bitwise described the 2025 quarter of Q1 as “the worst quarter in crypto history.” Matt Hougan, the company’s chief investment officer, said it was a “frustrating” time for the industry.

The first quarter has been the first American pro-Crypto president in history, creating the creation of a strategic Bitcoin reserve, the SEC abandoned most of the lawsuits and the end of the Biden-er-the Crypto war.

“Crypto has dreamed of these developments for years and they finally happened.”

Good, bad and ugly

However, the market and emotions do not reflect good luck. He added that the 10-cap crypto index fell 18%, crypto stocks fell 27%, and Ethereum fell 45%.

Over a three-month period, the market cap totaled nearly 20% as $650 billion exited the space. Those losses have been extended into April as the market is currently down 30% from its all-time low of $3.9 trillion in January.

However, this is not all bad news. “Search things that will reach new historical highs when prices fall. They are a sign of the source of the next bull market,” Hogan advises.

Search for things that reach new historical climax when prices fall. They are a sign of the source of the next bull market. https://t.co/tynfnlceg2

– Matt Hougan (@matt_hougan) April 16, 2025

He noted that the all-time high of Stablecoin circulation exceeded $218 billion, up 13.5% in the quarter-quarter, while trading volume soared 30%. According to Coingecko, Stablecoin’s current market cap is $236 billion, accounting for about 8.6% of the cryptocurrency’s market cap, more than any other asset other than Bitcoin.

In addition, the marked real-world assets “parabolic parasites” in the first quarter, growing a quarter of the quarter to new all-time highs, he added.

Finally, regulated Bitcoin futures trading volume and open interest also reached an all-time high, indicating that “institutional equity as macro-traded assets is growing”, he suggests that these trends may lead to higher markets.

“As we enter the second quarter, I hope these and related areas will lead the market higher.”

The ugly side is the bursting of the $1.5 billion bybit hack and meme coin bubble, which causes most of these incompetent tokens to collapse.

Key Encrypted Speaker

BITWISE has identified several key end winds that can reverse the three-month downward trend. After years of tightening, global central banks have expressed a shift to monetary easing and M2 expansion. It noted: “Historically, these conditions have been favorable to risky assets, especially for digital assets.”

In the United States, regulatory relief and new frameworks for stable bacteria and Defi may also be key catalysts.

Finally, the trade war, capital controls and statutory devaluation are prompting global investors to reevaluate their portfolios.

“In this environment, Bitcoin (e.g., gold) is increasingly seen as a potential hedge: liquid, scarcity, (most importantly) independent of tariffs, capital controls and currency manipulation.”