The cryptocurrency market closed the first quarter of 2026 on a negative note, with Bitcoin recording its sharpest first-quarter decline since 2018, raising concerns about the short-term trend of the world's largest digital asset, although analysts still view the long-term outlook positively.
According to aggregated data from Yahoo Finance , Bitcoin ended the first quarter of 2026 at $66,619, a sharp drop from $87,508 on January 1, 2026, equivalent to a 23.8% decline. This is the worst first quarter since 2018, when Bitcoin plummeted by as much as 50% in just the first three months of the year. Notably, this decline continues the weakening chain from the fourth quarter of 2025, when the price of BTC fell 23% from $114,057 to $87,508. Thus, in just six months, Bitcoin lost approximately 41.6% of its value – a deep correction rarely seen since the last growth cycle.
Selling pressure stems not only from within the crypto market but is also strongly influenced by the global macroeconomic context. Escalating geopolitical tensions in the Middle East have made investors cautious, leading to a wave of risk aversion spreading from traditional stocks to digital assets. Simultaneously, the reversal of Capital into US Bitcoin ETFs has also become a key factor putting pressure on prices.
According to Andri Fauzan Adziima, Head of Research at Bitrue , the first-quarter decline was primarily due to outflows from Bitcoin ETFs, combined with stubborn inflation, the Federal Reserve 's cautious stance, and widespread risk aversion. Data from SoSoValue shows that spot Bitcoin ETFs recorded net outflows of $496.5 million in the first quarter. In the first two months of the year alone, outflows totaled $1.8 billion, before being partially offset by inflows of $1.32 billion in March.
However, many experts believe the current downward trend is more cyclical than a sign of long-term weakness. Min Jung, a researcher at Presto Research , notes that there is no clear evidence to suggest that long-term confidence in Bitcoin has been broken. The participation of large institutions and the trend of adopting digital assets continue, indicating that Bitcoin's fundamentals remain solid.
Geopolitical factors are becoming the focus of market attention. US President Donald Trump has stated that the US- Iran conflict could end within two to three weeks, even without a formal agreement. He is expected to deliver a prime-time address to update on the situation, amidst Iran's continued attacks on Gulf states. These developments are XEM as major variables that could significantly impact global financial markets in the second quarter of 2026.
Nick Ruck, Director of Research at LVRG Research , believes that to reverse the downward trend in the second quarter, the market needs three factors: the return of ETF inflows, clearer progress on a crypto-friendly regulatory framework in the US, and a more relaxed monetary environment. These are also the three "engines" that fueled Bitcoin's strong bull cycle in the 2023-2025 period.
