Coinbase Monthly Market Outlook: Crypto Winter Fears Emerge Amid Broader Economic Pressures

Coinbase Monthly Market Outlook

Coinbase’s latest market review for institutional investors, published on April 15, paints a cautious picture of the current crypto landscape. While the digital asset market has notably contracted, the report suggests that it may be laying the groundwork for a potential rebound in the months ahead.

According to the analysis, the altcoin market capitalization has dropped significantly—down 41% from its peak of $1.6 trillion in December 2024 to approximately $950 billion by mid-April. Data from BTC Tools shows that this figure hit a low of $906.9 billion on April 9 before recovering slightly to $976.9 billion.

Venture capital investment in the crypto space has also cooled considerably, falling by an estimated 50%–60% compared to 2021 and 2022 levels. Coinbase’s Global Head of Research, David Duong, warned that the convergence of multiple bearish signals could mark the beginning of another “crypto winter.”

“Several converging signals may be pointing to the start of a new ‘crypto winter’ as some extreme negative sentiment has set in due to the onset of global tariffs and the potential for further escalations,” Duong noted.

Macroeconomic Challenges Undermining Market Momentum

The report highlights how the broader macroeconomic environment is exerting downward pressure on the crypto market. Declining interest from venture capitalists has limited the inflow of new capital—particularly in the altcoin space. Duong attributes this trend to uncertainty in the global economy, where traditional risk assets are struggling under the weight of fiscal tightening and protectionist policies.

“These structural pressures reflect broader market uncertainty, contributing to a slowdown in investment decision-making across the digital asset ecosystem,” he explained.

Despite the current challenges, the report suggests that a shift in market sentiment—when it occurs—could be swift and dramatic. Coinbase remains cautiously optimistic for the second half of 2025.

Indicators Point to Mixed Signals

The report evaluates several metrics to distinguish between bull and bear markets. One such metric is the Bitcoin Z-score, which measures market sentiment by comparing Bitcoin’s market value to its realized value. While effective in identifying overbought or oversold conditions, the Z-score reacts slowly in stable markets and tends to produce fewer signals.

Coinbase’s model indicates the bull market concluded in late February. Since then, market conditions have appeared more neutral.

Duong suggests the 200-day moving average may offer a more reliable indicator of long-term trends. Unlike short-term volatility indicators, it provides a smoothed view of market momentum over time. According to this metric, Bitcoin entered bear market territory in late March, while the Coin50 Index—which tracks the top 50 crypto assets—turned bearish as early as February.

A Shifting Role for Bitcoin

Interestingly, Coinbase’s analysts argue that Bitcoin is no longer a catch-all indicator for the broader crypto market. With the rise of decentralized finance (DeFi), decentralized physical infrastructure (DePIN), and AI-powered protocols, different sectors within crypto are developing their own market dynamics, increasingly independent of Bitcoin.

Recent data suggests Bitcoin has shown surprising resilience to global macroeconomic turbulence, especially compared to traditional financial markets. As Duong puts it:

“As Bitcoin’s role as a ‘store of value’ continues to grow, we believe it’s essential to adopt a broader view of the entire digital asset ecosystem when evaluating market conditions.”