Woofun AI reports that the cryptocurrency market has entered its first three-quarter losing streak since the 2022 bear market, a decline highlighted by asset manager Bitwise.

The Bitwise 10 Large Cap Crypto Index dropped 15.4% in the second quarter, with eight of its ten constituent assets posting losses. This performance underscores a broad-based weakness across major digital assets during the period.

This slump marks the longest consecutive quarterly decline since late 2022, a timeframe defined by the collapse of major platforms and widespread deleveraging.

Notably, Spot Bitcoin exchange-traded funds (ETFs) recorded their largest-ever quarterly net outflow, signaling reduced investor appetite for direct exposure through regulated products.

Per Woofun AI, underlying fundamentals remain robust despite price declines. Ethereum trading activity surged approximately 13-fold, while decentralized finance (DeFi) total value locked (TVL) grew by over 60%. Stablecoin assets under management have doubled compared to 2022 bear market levels.

The divergence between price action and fundamental growth suggests capital is rotating into yield-generating instruments rather than exiting the ecosystem. While macroeconomic pressures and regulatory uncertainty persist, the expansion of DeFi TVL and stablecoin issuance indicates structural maturation. This data implies that current price declines do not equate to ecosystem failure, but rather a shift in capital allocation.