The first quarter of 2026 was marked by significant declines in digital assets, attributed to escalating geopolitical tensions, a cautious Federal Reserve, and institutional flows turning negative.
According to CoinDesk's Quarterly Review and Outlook, the CoinDesk 20 Index declined by 27.4% to 1,952, while bitcoin fell 22.1% to $68,228. This represents its second-largest quarterly decline since Q2 2022.
The Federal Reserve held rates steady at 3.5%–3.75% following its March meeting, and the S&P 500 and Nasdaq declined by 4.63% and 5.98%, respectively. However, gold was a standout performer, rising 8.19% to $4,671.
Notably, bitcoin had already declined roughly 30% from its February peak before geopolitical tensions escalated sharply in late February, suggesting that much of the fear and forced liquidations had been priced in beforehand.