Shares of Coinbase (COIN), the largest crypto exchange in the US, have faced significant declines during the first quarter (Q1) of the year, primarily due to escalating concerns about the US economy and its impact on digital assets. 

Coinbase And Others Face Increased Volatility

According to Bloomberg, Coinbase’s stock has dropped more than 30% since the beginning of the quarter, marking its worst performance since the collapse of the FTX exchange in late 2022. 

This decline is reflective of a broader trend affecting nearly all major crypto-linked stocks, including companies like Galaxy Digital Holdings (GLXY.TO), Riot Platforms (RIOT), and Core Scientific (CORZ).

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The cryptocurrency market itself is experiencing turmoil, with Bitcoin (BTC) falling over 20% from its all-time high and Ethereum (ETH) plummeting more than 45% in value. 

These shifts come amid President Donald Trump’s escalation of a “global trade war,” which has stirred fears about the health of the country’s economy. Economic data has exacerbated these concerns, pushing the S&P 500 Index (GSPC) toward its worst quarter since mid-2022. 

Oppenheimer analyst Owen Lau noted that many within the cryptocurrency community recognize that the current market conditions are not primarily driven by fundamental factors. Instead, Lau emphasized that macroeconomic issues—such as tariffs and the potential trade war—are influencing investor sentiment significantly. 

The looming threat of a recession has reportedly added to the unease, causing higher-risk crypto-linked stocks to be even more volatile than Bitcoin itself. 

Lau explains that investments in companies like Coinbase carry additional risks, including the potential for bankruptcy, allegedly making them particularly susceptible to swift sell-offs.

Cryptocurrency Market Struggles To Rebound

The current state of the cryptocurrency market is a stark contrast to the optimism that prevailed at the start of the year, following Trump’s election. Bitcoin reached a record high of over $109,000 on Inauguration Day. 

Earlier this month, Bitcoin prices fell after Trump announced a strategic reserve for the market’s leading crypto, but did not allocate taxpayer funds to expand it. As of now, Bitcoin trades around $83,000, still above pre-election levels but far from its peak.

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While shares of various crypto-related companies surged following the election, Coinbase and crypto miners have since relinquished those gains. Notably, Michael Saylor’s Strategy (MSTR) is among the few stocks in the sector that has managed to remain in positive territory since November 5.

Despite the downturn, the cryptocurrency industry continues to gain influence in Washington and is moving closer to integration with traditional financial systems. However, this growing power has yet to translate into a market rebound. 

Connor Loewen, a cryptocurrency analyst at 3iQ, expressed skepticism about the current state of investor sentiment, stating, “What we saw a couple of months ago, I don’t know how much crazier it can get than that. I think we’re going to have to be looking for new catalysts.”

Featured image from DALL-E, chart from TradingView.com 

The head of research of market intelligence firm Fundstrat says that the odds of a V-shaped recovery for the stock market in April are overwhelmingly high.

In a new interview with CNBC Television, Tom Lee says that based on historical patterns, the stock market could mount a recovery in early April.

“The spike in the VIX (volatility index) or the collapse in investor sentiment or consumer confidence, that all happened around February 2018, so really that coincided with the first low that was made in 2018, and the market began to stage its recovery…

But as we start to think about the second half of this year, first of all, we’ve already had the collapse in sentiment. We’ve seen $850 billion of cash raised over the past year in money market balances, and then in the second half, we were looking for tax reform, which really propelled stocks in 2017.”

According to Lee, much of the panic in the stock market has already taken place this year, leading him to believe that stocks should start regaining their bullish momentum this week.

“So I think that the odds of a V-shaped recovery in stocks that come after April 2nd is just extremely high, because we’ve already sequenced a lot of the panic that people saw in 2018. I think it’s already taking place.”

A V-shaped rally is a technical pattern indicating an abrupt bullish reversal and a sharp surge in the market.

Earlier this month, both the stock and crypto markets took a hard hit after President Donald Trump announced tariffs and refused to rule out an upcoming economic recession.

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Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any losses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.

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Christian’s journey with the written word began long before the age of Bitcoin. In the hallowed halls of academia, he honed his craft as a feature writer for his college paper. This early love for storytelling paved the way for a successful stint as an editor at a data engineering firm, where his first-month essay win funded a months-long supply of doggie and kitty treats – a testament to his dedication to his furry companions (more on that later).

Christian then roamed the world of journalism, working at newspapers in Canada and even South Korea. He finally settled down at a local news giant in his hometown in the Philippines for a decade, becoming a total news junkie. But then, something new caught his eye: cryptocurrency. It was like a treasure hunt mixed with storytelling – right up his alley!

So, he landed a killer gig at NewsBTC, where he’s one of the go-to guys for all things crypto. He breaks down this confusing stuff into bite-sized pieces, making it easy for anyone to understand (he salutes his management team for teaching him this skill).

Think Christian’s all work and no play? Not a chance! When he’s not at his computer, you’ll find him indulging his passion for motorbikes. A true gearhead, Christian loves tinkering with his bike and savoring the joy of the open road on his 320-cc Yamaha R3. Once a speed demon who hit 120mph (a feat he vowed never to repeat), he now prefers leisurely rides along the coast, enjoying the wind in his thinning hair.

Speaking of chill, Christian’s got a crew of furry friends waiting for him at home. Two cats and a dog. He swears cats are way smarter than dogs (sorry, Grizzly), but he adores them all anyway. Apparently, watching his pets just chillin’ helps him analyze and write meticulously formatted articles even better.

Here’s the thing about this guy: He works a lot, but he keeps himself fueled by enough coffee to make it through the day – and some seriously delicious (Filipino) food. He says a delectable meal is the secret ingredient to a killer article. And after a long day of crypto crusading, he unwinds with some rum (mixed with milk) while watching slapstick movies.

Looking ahead, Christian sees a bright future with NewsBTC. He says he sees himself privileged to be part of an awesome organization, sharing his expertise and passion with a community he values, and fellow editors – and bosses – he deeply respects.

So, the next time you tread into the world of cryptocurrency, remember the man behind the words – the crypto crusader, the grease monkey, and the feline philosopher, all rolled into one.