Coinbase warns of potential new crypto winter as market signals turn bearish

The steep diminution successful crypto valuations and a breakdown of cardinal method indicators whitethorn awesome the commencement of a caller carnivore marketplace for integer assets, according to a caller study from Coinbase.

In its April Monthly Outlook report, the crypto speech warned that marketplace signals are progressively pointing to what galore successful the manufacture telephone a “crypto winter,” a prolonged downturn marked by falling prices, reduced liquidity, and waning capitalist enthusiasm.

The full crypto marketplace cap, excluding Bitcoin (BTC), has plunged 41% since reaching a highest of $1.6 trillion successful December 2024. As of mid-April, it present sits astatine $950 billion, beneath levels seen for astir of 2022.

The driblet coincides with a crisp pullback successful task superior investment, which remains down 50–60% from its 2021–2022 highs contempt a humble betterment successful aboriginal 2025.

Combined with broader macroeconomic challenges, including planetary tariffs, fiscal tightening, and slumping equities, the outlook for crypto successful the adjacent word remains fragile, the study said.

Technical analysis

According to David Duong, Global Head of Research astatine Coinbase, caller declines in  Bitcoin and the COIN50 Index, the second representing the 50 largest non-Bitcoin cryptocurrencies, are not conscionable regular volatility.

Both person breached beneath their 200-day moving averages, a wide recognized method indicator utilized to gauge semipermanent marketplace momentum. Duong wrote:

“This determination beneath the 200DMA suggests we are entering a bearish cycle. While bitcoin has declined little than 20% from its caller high, the broader altcoin marketplace has experienced overmuch sharper losses, underlining the accrued hazard and volatility further down the crypto hazard curve.”

The study argued that accepted definitions of bull and carnivore markets, specified arsenic the 20% threshold commonly utilized successful equity markets, are excessively simplistic for the crypto space. With integer assets often swinging 20% oregon much wrong days, alternate metrics are needed to measure existent marketplace conditions.

The steadfast favors 2 measures successful particular: risk-adjusted show utilizing modular deviations (or z-scores), and the 200DMA trend. These tools connection a much nuanced view, reflecting not conscionable terms drops but besides momentum shifts and changes successful capitalist psychology.

The investigation showed that Bitcoin’s caller diminution represents a 1.4 modular deviation determination beneath its humanities norm, comparable to the magnitude of banal marketplace corrections successful past carnivore markets.

At the aforesaid time, the COIN50 Index has been successful bear territory since precocious February, reinforcing concerns astir the wellness of the broader crypto ecosystem.

Cautious outlook

While Coinbase is advising a antiaircraft stance successful the abbreviated term, peculiarly implicit the adjacent 4 to six weeks, it remains cautiously optimistic astir the 2nd fractional of 2025.

The study suggested that the marketplace whitethorn find a bottommost by the extremity of the 2nd quarter, perchance paving the mode for a stronger third-quarter recovery.

Duong noted:

“Sentiment tin alteration rapidly successful crypto erstwhile macro pressures ease. But close now, the situation calls for subject and selectivity.”

The study besides emphasized the increasing complexity of the crypto market, arguing that Bitcoin tin nary longer service arsenic a elemental proxy for the full space.

As sectors similar DeFi, infrastructure tokens (DePIN), and AI-driven agents expand, the divergence successful show and hazard is becoming much pronounced.

According to the report:

“As bitcoin matures into a store-of-value asset, knowing the broader marketplace requires much granular tools. The days of treating the crypto marketplace arsenic a monolith are over.”

Despite the challenges, Coinbase believes the semipermanent fundamentals for crypto stay intact. However, until macroeconomic conditions stabilize and superior begins flowing backmost into the space, volatility and caution are apt to dominate.

The station Coinbase warns of imaginable caller crypto wintertime arsenic marketplace signals crook bearish appeared archetypal connected CryptoSlate.