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.
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.
Related Reading: XRP Bull Cycle Could End If This Happens: Analyst 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.
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