• Despite investor hopes coming into the year, Bitcoin and Ethereum have had a woeful Q1.

• The crypto market has been caught up in broader macroeconomic uncertainty.

• History suggests Q2 may be better, but short-term concerns remain.

In Q4 2024, Bitcoin surpassed $100,000 for the first time in history, and several other cryptocurrency assets posted triple-digit percentage gains, stoking hopes for a positive run in Q1 2025. But the reality has been anything but.

Instead of the anticipated glorious run, cryptocurrency market leaders Bitcoin and Ethereum are on track for their worst Q1 close in seven years. Can the market make a comeback in Q2?

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Despite investor hopes coming into the new year, at the time of writing on March 31, Bitcoin and Ethereum are down 11.95% and 45.06%, respectively, in Q1. With only a few hours to go to the end of the quarter, these leading cryptocurrency assets are on track for their worst quarterly close since 2018.

The woeful showing follows rapidly shifting global macroeconomic and geopolitical dynamics that have sparked uncertainty and left risk assets subdued. The first sign of trouble was the Federal Reserve’s hawkish pivot in December, when it cut its interest rate cut projections for 2025, arguing that it expected inflation to remain sticky.

President Donald Trump‘s erratic tariff policy has further complicated the situation, worsening inflation fears and sparking economic growth concerns.

Despite these overarching concerns, cryptocurrency market participants are holding out hope for a turnaround in Q2, and history may be on their side.

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Looking at the historical data, Q2 has more often than not been positive for the cryptocurrency market.

Seven out of 12 times, Bitcoin has closed the second quarter of the year in the green, averaging 27% gains. The numbers are even more impressive for Ethereum.

Seven out of nine times, the second largest cryptocurrency asset by market cap has ended the second quarter in the green with an average gain of 67%, typically outperforming Bitcoin within the period.