- Bitcoin outperformed Ethereum in early 2025 as institutions favored BTC and ETH faced steep double-digit losses across both quarters.
- The broader crypto market declined sharply with a $1 trillion market cap drop and a 27 percent slump in average daily trading volume.
- Memecoins like Trump-themed tokens crashed over 90 percent while Pump.fun token launches fell 56 percent by the end of Q1.
Bitcoin’s performance in 2025 has outpaced Ethereum, surprising many seasoned analysts, including Daan Crypto Trades. Daan noted a clear divergence in Q1 and Q2 returns between the two assets. Historically, Ethereum has followed Bitcoin’s lead. However, this year defied that pattern. Ethereum saw a sharp 45.41% drop in Q1 and fell another 13.47% in Q2. Meanwhile, Bitcoin dipped 11.82% in Q1 but managed a slight recovery of 2.27% in Q2. This disconnect raised questions about Ethereum’s cyclical momentum, especially compared to previous cycles.
Institutional Pressure and Market Shifts
Bitcoin’s steadier performance comes amid growing institutional involvement and ETF inflows. Traditional finance has leaned more toward Bitcoin, especially after the 2024 ETF approvals. Consequently, Ethereum’s market role seems more uncertain than ever.
Some compare its current cycle to XRP’s previous path—one great run, one lackluster phase, and a potential rebound. Daan acknowledged Ethereum’s strong utility and reliability, particularly for on-chain applications. However, he emphasized that strong fundamentals don’t always correlate with token price action.
Market Volatility and Volume Declines
Besides price movement, the broader crypto market showed signs of weakness in early 2025. A Coingecko report confirmed a sharp 18.6% drop in total market capitalization in Q1. The market cap fell from $3.8 trillion in January to $2.8 trillion by March, right after Trump’s inauguration.
Additionally, average daily trading volume slid by 27.3%, down to $146 billion. Centralized exchanges (CEXs) suffered as well. Binance retained dominance with a 40.7% share, though its volume plummeted from $1 trillion in December to $588.7 billion in March.
Memecoin Mania Fizzles Out
Moreover, the memecoin craze that surged at the start of the year lost steam quickly. Tokens tied to Trump and the First Lady soared early, only to collapse by over 90%. Pump.fun, a leading memecoin launchpad, saw token launches fall 56% from January highs, closing Q1 with only 31,000 daily deployments.
