The election of US President Donald Trump was supposed to usher in a golden era of crypto. Although the regulatory stars are aligning, the crypto industry just experienced its worst quarter in years.

The prices of Bitcoin (BTC) and Ether (ETH) recorded their worst Q1 in seven years, market sentiment fell to its lowest point since the last bear market, and Coinbase stock experienced its worst sell-off since the FTX debacle. 

With the first quarter finally in the books, investors are looking forward to positive catalysts for Bitcoin and the broader market. This could come in the form of favorable Spring seasonality, more clarity on Trump’s tariff policy and shifting policy winds at the Federal Reserve. 

Coinbase stock suffers worst quarter since 2022

Coinbase stock, which has long been considered an important bellwether for the crypto industry, plunged by 33% in the first quarter despite reporting strong business fundamentals and a solid revenue outlook. As Cointelegraph reported, it was the worst quarterly decline since the FTX exchange collapse in late 2022.

Like other crypto-native businesses, Coinbase’s performance languished under the pressure of Trump’s tariff war, volatile digital asset prices and the overhang of tightening financial conditions from the previous quarter.

Beyond these short-term headwinds, though, Coinbase is booming. The company’s revenues more than doubled in 2024, reaching $6.6 billion. Its adjusted earnings rose to $3.3 billion, marking two consecutive years of growth. 

COIN stock’s volatile year so far. Source: Google Finance

Trump family backs Bitcoin mining venture

Despite fear and volatility gripping the crypto markets, Donald Trump’s family is doubling down on its long-term investments in the industry. 

On March 31, two of Trump’s sons, Eric and Donald Jr., announced they are backing a new crypto-mining venture called American Bitcoin. The venture is majority-owned by Hut 8, a public crypto miner. 

American Bitcoin “aims to become the world’s largest, most efficient pure-play Bitcoin miner while building a robust strategic Bitcoin reserve,” the announcement said.

Although crypto prices are down, it’s getting harder for investors to remain bearish on the industry with the Trump family investing so heavily. The family is behind the DeFi project World Liberty Financial, which has amassed a large portfolio of digital assets that include Ether, Wrapped Bitcoin (WBTC), Aave (AAVE) and Chainlink (LINK).

Tether stacks more BTC

Stablecoin issuer Tether bolstered its balance sheet in the first quarter by acquiring 8,888 Bitcoin, according to onchain data that was later confirmed by CEO Paolo Ardoino. The company now holds 100,521 BTC valued at roughly $8.7 billion.

Tether is able to acquire Bitcoin and expand its venture capital business thanks in large part to its highly profitable stablecoin operations. The company generated $13 billion in profit last year on the back of its massive holdings of interest-bearing US Treasury bonds. 

Despite its success, Tether has been the subject of negative reports by the media, industry and politicians. A recent JPMorgan report argued that Tether would be forced to sell a portion of its Bitcoin holdings to comply with forthcoming US stablecoin regulations. 

A company spokesperson threw cold water on the conclusion, telling Cointelegraph that JPMorgan understands “neither Bitcoin nor Tether.” 

GameStop raises $1.5B for Bitcoin purchases

Video game retailer turned meme stock GameStop Corporation is poised to add Bitcoin to its balance sheet after finalizing a $1.5 billion convertible debt offering.

“The company expects to use the net proceeds from the offering for general corporate purposes, including the acquisition of Bitcoin in a manner consistent with the Company’s Investment Policy,” GameStop said.

GameStop’s board approved the plan to invest in Bitcoin last month. The approval also green-lighted the company’s acquisition of US dollar-denominated stablecoins. 

In addition to raising debt to buy Bitcoin, GameStop hinted at potentially using a portion of its $4.8 billion cash reserves to fund future acquisitions. 

GameStop shares have experienced extreme volatility since March 26, when the company first disclosed its plan to acquire BTC. Source: Google Finance

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Stablecoins are “in a bull market of their own,” even as smart contract platforms — including Ethereum and Solana — sputter amid the marketwide tumult, asset manager VanEck said in an April 3 monthly note.

The diminished activity on smart contract platforms reflects cooling market sentiment in cryptocurrencies and beyond as traders brace for the impact of US President Donald Trump’s sweeping tariff policies and a looming trade war. 

But stablecoin adoption — a key measure of Web3’s overall health — continues apace. This is partly because ongoing macroeconomic uncertainty “could accelerate the strategic case for crypto,” Matthew Sigel, VanEck’s head of research, said in an April 4 X post.

Tokenized treasury bills help support stablecoin adoption. Source: VanEck

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Stablecoins gain steam

Stablecoins collectively added nearly $10 billion in total market capitalization in March as multiple issuers, including VanEck, prepare to launch branded stablecoin products, it said. 

The inflows persisted despite a steep drop in average stablecoin yields, the asset manager noted. 

Stablecoin yields now range from around 3% to 5% — near or slightly below Treasury Bills — compared to as high as 10% at the start of the year, it said. 

Even so, issuance of tokenized Treasury Bills — a primary source of institutional stablecoin yield — increased 26% from February to March, surpassing $5 billion in total issuance, according to the report.

Ethereum, Solana slow down

Meanwhile, smart contract platforms suffered across-the-board declines in activity, with revenues and trading volumes dropping 36% and 40%, respectively, according to the report. 

Solana has suffered particularly sharply. Daily fee revenues and decentralized exchange (DEX) volumes diminished by 66% and 53%, respectively, in March, VanEck said.

In fact, Solana’s DEX share of volumes once again fell below those of Ethereum and its layer-2 scaling chains (L2s) after briefly surpassing them for the first time in February. 

Solana lost ground to Ethereum in DEX volume. Source: VanEck

This relative decline partly reflects a slowdown in memecoin trading, which still dominates Solana DEX activity. 

The segment has suffered since February after a series of memecoin-related scandals soured sentiment among retail traders. 

On Feb. 14, Libra, a memecoin seemingly endorsed by Argentine President Javier Milei, erased some $4.4 billion in market capitalization within hours of launching.

In March, trading volumes on Ethereum’s L2s also experienced declines — retracing by some 18% from February — but held up better than Solana’s, according to VanEck.

During the final week of March, “blob fees,” the Ethereum network’s main source of income from L2s, sunk to the lowest weekly levels so far this year, according to Etherscan.

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First Trust Advisors has launched two Bitcoin (BTC) strategy exchange-traded funds (ETFs) designed to provide investors with Bitcoin exposure while capping losses and earning yield, the asset manager said. 

The move comes amid an outpouring of funds seeking to enhance Bitcoin’s appeal to traditional investors by offering tailored exposure to the cryptocurrency’s performance.

The FT Vest Bitcoin Strategy Floor15 ETF (BFAP) is designed to track Bitcoin’s performance up to a capped upside while limiting drawdown risk to approximately 15%, First Trust said in an announcement.

“Over the past few years, investors have shown a remarkably strong appetite for bitcoin-linked ETFs, but the potential for sharp drawdowns has kept many on the sidelines,” Ryan Issakainen, an ETF strategist at First Trust, said in a statement.

First Trust launched two new Bitcoin strategy funds. Source: First Trust

The FT Vest Bitcoin Strategy & Target Income ETF (DFII) is an actively managed fund aiming to offer partial Bitcoin exposure while generating a yield that beats short-dated US Treasurys by at least 15%, according to the asset manager. 

The DFII fund “will seek to take advantage of bitcoin’s high volatility to generate income by selling call options,” Issakainen said. The BFAP fund also uses financial derivatives to hedge downside risk. 

Options are contracts granting the right to buy or sell — “call” or “put,” in trader parlance — an underlying asset at a certain price.

Related: Trump-linked Strive files for ‘Bitcoin Bond’ ETF

Structured Bitcoin funds

Launched in January 2024, Bitcoin ETFs emerged as one of last year’s hottest investment products. 

As of April 4, spot BTC ETFs collectively manage approximately $93 billion in assets, according to data from Bitbo. 

Bitcoin ETFs saw outflows after US President Trump announced tariffs. Source: Farside Investors

Other types of ETFs designed to offer tailored exposure to Bitcoin’s performance are also gaining popularity. 

On April 2, Grayscale — a cryptocurrency-focused asset manager — launched two Bitcoin strategy ETFs. Like First Trust’s ETFs, they use financial derivatives to optimize for downside risk management and income generation. 

In March, asset manager Bitwise launched an ETF holding stocks of companies with large Bitcoin treasuries. 

Spot BTC ETFs saw nearly $100 million in outflows on April 3 amid the heightened market volatility following US President Donald Trump’s tariff announcement of sweeping tariffs on April 2. 

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