Crypto Markets React to the Report that U.S. Economic Activity Decreased in Q1 2025

Following the report that economic activity in the U.S. not only stalled but actually decreased during the first quarter—crypto and other financial markets are already getting the initial impact of a potential recession in America in 2025.

The U.S. Q1 GDP came in at a negative 0.3%, contrasting with the projections of a 0.2% rise in economic activity.

This outcome puts the current administration in a difficult position, and it may also influence the Federal Reserve's decision on Trump’s calls for rate cuts at the upcoming FOMC meeting on May 6-7.

Polymarket Recession Bet Hits ATH

The contract on Polymarket predicting a U.S. recession in 2025 reached its highest point yet, with a 71% chance.

The bet shot up by 7% in the last hour alone, showcasing the immediate market response to the disappointing GDP reading. Other financial instruments are also feeling the impact, including stock and crypto.

Bitcoin Takes a Hit

The market-leading cryptocurrency stalled its ascending momentum only minutes after the GDP Q1 report. Bitcoin was trading at $95,208 before the report, only to fall by 0.68% five minutes after the news broke.

Currently, $BTC trades at $94,480 and still experience a surplus of trading volume as investors react to the unexpected -0.3% GDP print.

So, are we heading towards a full on recession, or is the Trump administration bet on aggressive foreign trade pay off by the end of the year? Bookmark us and we’ll keep you updated, deal?