Bitwise Reports Crypto Market Down 15.4% in Q2 as Negative Return Streak Extends

Bitwise says crypto fell 15.4% in Q2, but RWAs, stablecoins, and prediction markets continued to expand.

Crypto markets faced another difficult quarter as Bitwise reported its third straight period of negative returns. While the Bitwise 10 Large Cap Crypto Index fell 15.4% in Q2, parts of the industry continued to grow despite weaker prices. Even with weaker prices, several parts of the industry continued to expand, suggesting that development has not stopped despite the market downturn.

Bitwise: Eight of Top 10 Crypto Assets End Q2 in the Red 

Crypto asset manager Bitwise reported that its Bitwise 10 Large Cap Crypto Index fell 15.4% during the second quarter, with eight of the index’s ten assets posting negative returns. Bitcoin, Ethereum, Solana, XRP, Cardano, Chainlink, Litecoin and Sui all ended the quarter lower. Meanwhile, Hyperliquid stood out as the strongest performer after gaining 79%, while Stellar Lumens also posted a modest positive return.

According to the report, Bitcoin remained under pressure throughout the second quarter. Its price dropped below $60,000 in June to the lowest level since 2024 and is sitting more than 50% below its October peak. Ethereum also struggled, delivering one of the weakest performances among the major cryptocurrencies this quarter.

Institutional demand also slowed as the U.S. spot Bitcoin exchange-traded funds recorded net outflows of $4.9 billion during the quarter, making it their largest quarterly withdrawal since launching in early 2024. Bitwise also noted that crypto’s correlation with traditional stock markets increased during the quarter, suggesting broader macroeconomic conditions continued to influence digital asset prices.

In addition, the cryptocurrency market was shaped by several significant Q2 milestones. Charles Schwab and E*Trade launched retail crypto trading services, while the U.S. Commodity Futures Trading Commission approved the country’s first regulated Bitcoin perpetual futures product. At the same time, lawmakers were unsuccessful in moving forward with the CLARITY Act after it stalled in the Senate, leaving regulatory uncertainty in place.

Tokenized Assets and Prediction Markets Defy Crypto Slowdown

Although prices remained under pressure, Bitwise said several industry fundamentals continued to perform well. Prediction markets reached a record $43 billion in trading volume during the quarter, showing rising interest in blockchain-based forecasting platforms.

Meanwhile, tokenized real-world assets also continued gaining traction. Assets under management climbed 45% since the start of the year to about $33 billion, supported by growing demand for tokenized U.S. Treasuries and other financial products. 

At the same time, stablecoin supply remained close to $300 billion despite the broader market decline, pointing to continued activity across digital payment networks. Crypto-related stocks produced a different result from digital assets themselves. 

According to the Bitwise report, the firm’s Crypto Innovators 30 Index rose 30.6% during the quarter. This was largely driven by strong gains among BTC mining companies with artificial intelligence exposure. Several mining firms significantly outperformed the broader crypto market despite falling cryptocurrency prices.

Bitwise also argued that many long-term indicators remain stronger than during the previous bear market. The company believes upcoming regulatory decisions, continued stablecoin adoption, and further institutional participation could influence market direction during the second half of the year.