Coinbase Institutional Warns of Crypto Winter as Market Momentum Shifts
Standard bear market definitions may no longer be sufficient to capture the evolving dynamics of the crypto market, according to a new report from Coinbase Institutional.
The firm’s research suggests that the latest crypto bull cycle may have come to an end, ushering in a phase of prolonged weakness and stagnation—what many refer to as a “crypto winter.”
“Based on the 200-day moving average (200DMA), Bitcoin’s sharp drop in recent weeks indicates that a new bear market likely began in late March,” wrote David Duong, Global Head of Research at Coinbase Institutional. “However, when applying the same analysis to the COIN50 index—which tracks the top 50 digital assets by market cap—it’s clear that the broader crypto asset class has been in bear territory since late February.”
Bitcoin fell below its 200-day simple moving average on March 9 and has remained beneath it since, a widely recognized signal of a shift to long-term bearish momentum. The 200DMA is a critical technical marker often used to distinguish between bull and bear trends.
Duong emphasized the limitations of applying traditional financial metrics—such as a 20% drawdown—to crypto, where sharp corrections are far more common. In the crypto market, he argued, smaller but rapid sell-offs can significantly impact sentiment and investor behavior, even if they don’t meet that threshold.
“We’ve seen that sentiment-driven declines can prompt defensive moves by investors before a 20% drop is ever reached,” he said. “We believe bear markets in crypto are less about arbitrary percentage declines and more about fundamental regime shifts—marked by deteriorating liquidity and weakening fundamentals.”
Beyond the 200DMA, Coinbase also uses a z-score model to evaluate Bitcoin’s performance in relation to its average over the past year. That model confirmed the end of the most recent bull run in late February and has since categorized market activity as “neutral”—a sign of the model’s sensitivity lag in fast-moving conditions.
Coinbase is advising a cautious approach to risk assets for now, particularly given broader structural headwinds.
Alternative cryptocurrencies may be hit harder in the coming months, especially as venture capital funding continues to dry up. Despite Bitcoin setting new all-time highs earlier this year—surpassing its 2021 peak of $70,000—the rally failed to reignite interest in early-stage funding. VC inflows remain 50% to 60% below the levels seen during the 2021–22 boom.
Duong noted that the market may begin to stabilize in the coming months, potentially setting the stage for a more favorable third quarter. “We may find a bottom sometime in mid-to-late Q2 2025, which could pave the way for recovery into Q3,” he added.
