Bitcoin simply achieved its worst first quarter in a decade, falling 11.7% as the markets fought to understand the economic agenda of the new administration.
The performance held the 12th position of the last 15 quarters, according to Nydig Research data.
The reduction invites a family question in cryptographic circles: is the cycle over? The last time Bitcoin began the year so bad was in 2015, during a prolonged fall after the 2013 peak and after the collapse of Mt. Gox, according to Nydig. At that time, prices recovered modestly for the rest of the year before increasing in 2016.
In the first quarter of 2020, in the midst of a massive market sale linked to the fears surrounding the Covid-19 pandemic, BTC saw a 9.4%reduction, but then recovered to end the year more than 300%. In other years with negative returns of the first quarter, such as 2014, 2018 and 2022, Bitcoin ended the year sharply, coinciding with the ends of the tail of the previous bull cycles, said the research note.
This time, the backdrop is murky. The prices of cryptocurrencies increased after Donald Trump won the US elections in November after executing a Pro-Crypto campaign. While under the Trump administration, the sector has been gaining greater regulatory clarity, and the United States Stock Exchange and Securities Commission (SEC) supported a series of demands against cryptographic companies, not everything is bullish.
Trump announced his reciprocal tariffs against almost all countries in the world last week, which led to a massive elimination of the US $ 5.4 billion market in just two days. This led to the lowest level of the S&P 500 index in 11 months and the entry of Nasdaq 100 in the Bear market territory. While Bitcoin has overcome so far, which will happen after Monday’s opening bell is not clear.
Historically, a weak Q1 does not always spell fatality for BTC, as shown by Nydig data. The asset has recovered in the middle of the years when it started in red. The recent macroeconomic backdrop has seen analysts to increase recession chances, which could prove the role of BTC as a “isolation coverage of the United States.”
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