TL;DR
- Coinbase shares have fallen more than 30% in the first quarter of 2025, marking its worst performance since the FTX collapse at the end of 2022.
- Crypto companies like Galaxy Digital, Riot Platforms, and Core Scientific have also dropped significantly, while Bitcoin and Ethereum have lost more than 10% and 45% of their value, respectively.
- Concerns about the U.S. economy and Trump’s trade war have driven investors to flee riskier assets.
Coinbase Global Inc.’s shares have fallen more than 30% in the first quarter of 2025, marking its worst performance since the FTX collapse at the end of 2022.
The drop has also affected other companies linked to the crypto industry, such as Galaxy Digital Holdings, Riot Platforms, and Core Scientific. In conjunction, the market has also suffered significantly, with Bitcoin falling more than 10% and Ethereum losing more than 45% of its value during the same period.
Concerns about the U.S. economy, fueled by the trade war initiated by President Donald Trump, have caused panic in the market. This economic climate has caused investors to flee from higher-risk assets, like cryptocurrencies, in favor of safer havens. The market’s reaction has not been limited to cryptocurrencies; the S&P 500 Index is also headed for its worst performance since mid-2022.
Coinbase and Crypto Companies Succumb to Economic Chaos
Shares of companies linked to cryptocurrencies are particularly vulnerable to this kind of chaos, as they are more volatile than the digital assets themselves. According to analysts, the market has reacted more quickly and sharply to negative economic signals, especially when it is perceived that cryptocurrencies, like Bitcoin, are not being driven by fundamental reasons but by macroeconomic factors such as tariffs and the threat of a recession.
Gold Shows Exceptional Performance
Despite the issues, gold has shown superior performance, recording its best quarterly return since 1986. In contrast, Bitcoin, which reached a historic high of over $109,000 at the beginning of the year, has dropped significantly, hovering around $82,000 by the end of March 2025. Its decline has occurred amid unmet expectations regarding Trump’s policies on cryptocurrencies, such as the creation of a strategic BTC reserve without authorization to expand it with public funds.
Although the crypto industry continues to gain influence in Washington and draw closer to traditional finance, these advancements have not translated into a significant market recovery. Analysts believe the industry will need new catalysts to spark a rebound, as the current situation seems insufficient to revive the enthusiasm that prevailed at the beginning of the year.
