Cryptocurrency Performance in Q1: A Review of the Market

This newsletter discusses the performance of cryptocurrencies in the first quarter, with a focus on shifting institutional demand and new regulatory developments that are setting the stage for the second quarter. The CoinDesk 20 Index fell by 27.4% in Q1, while bitcoin declined by 22.1%. However, the quarter also saw a recovery in institutional flows and a clarification of the regulatory environment, with 16 assets being designated as digital commodities. Looking ahead to Q2, the market will be shaped by the trajectory of the Middle East conflict and the Federal Reserve's response to inflation data. The structural foundation of the market is more durable than in previous cycles, with institutionalized ETF demand and a more supportive regulatory environment.