Xapo Bank Sees Bitcoin Trading Surge in Q1 as Wealthy Clients Buy the Dip

Gibraltar-based Xapo Bank, a private financial institution known for its crypto-focused services, reported a notable uptick in Bitcoin trading activity during the first quarter of 2025.

The bank revealed that trading volumes on its platform rose by 14.2% compared to the previous quarter, largely driven by its high-net-worth clients taking advantage of Bitcoin’s price decline to increase their holdings.

Bitcoin endured its worst quarterly performance since 2018, ending Q1 down 13%.

Despite the downturn, Xapo Bank said its affluent members remained confident in the digital asset’s long-term value and actively “bought the dip” during periods of market turbulence.

The bank interpreted this behavior as a sign of growing maturity among seasoned investors in the crypto space.

Xapo Bank has continued to expand its suite of crypto-banking services.

In March 2025, the firm introduced Bitcoin-backed USD loans of up to $1 million. Earlier in the year, it became the first licensed bank in the UK to offer interest-bearing Bitcoin and fiat banking accounts.

Additionally, the bank recorded a 50% quarter-on-quarter increase in euro-denominated deposits, which it attributed to rising concerns about U.S. dollar dominance and fears of a looming U.S. recession tied to policy uncertainty under the Trump administration.

The bank also noted changes in stablecoin usage among its members.

Deposits in USDC rose nearly 20%, while Tether (USDT) deposits declined by over 13%, a trend likely influenced by new European regulations that have prompted exchanges to delist Tether in order to comply with the EU’s Markets in Crypto-Assets Regulation (MiCA).

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“Xapo Bank member data shows that despite short-term headwinds, the bigger picture for Bitcoin remains strong,” said Gadi Chait, head of investment at Xapo Bank.

“The opportunity with Bitcoin has always been about long-term performance, not day-to-day volatility.”

Elsewhere in the market, Bitget also reported major growth during the same period.

According to its Q1 2025 Transparency Report, the exchange’s total trading volume hit $2.1 trillion, with spot trading volume surging 159% to $387 billion.

Bitget’s user base expanded rapidly as well, adding nearly 5 million new centralized exchange users and bringing its global user total to over 120 million.

The company also drew attention earlier this year for extending a no-interest, no-collateral $100 million ETH loan to rival exchange Bybit following a hack.

As reported, the first quarter of 2025 saw a significant market pullback, divergence between price and sentiment, and a shift to the fundamental technology, according to CoinMarketCap’s Q1 2025 Report.

The report concluded that Q1 2025 recorded “a broad market pullback.”

The reasons lie in Bitcoin (BTC) and Ethereum (ETH) underperformance, declining retail activity, macro uncertainty, a dropping exchange-traded fund (ETF) momentum, regulatory doubts, and decreasing investor interest resulting in thinning liquidity.

Overall, trading volume fell 40.65% in Q1, while market sentiment hit its lowest point since early 2023.

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