Coinbase Predicts Crypto Market Bottom by Mid-2025
Coinbase has issued a warning that the crypto market might be entering a new bear phase. Though, the company remains hopeful that prices could stabilize between May and June, setting the stage for a stronger third quarter.
In its April 15 report, Coinbase highlighted that the total crypto market cap, excluding Bitcoin, has dropped 41% since December 2024. It fell from $1.6 trillion to around $950 billion. Venture capital investment in crypto is also down, sitting 50-60% below the 2021-2022 peak.
These factors, coupled with global tariffs and economic uncertainty, have put pressure on the market, especially for altcoins. Traditionally,a bear market is defined by a 20% price drop. But Coinbase argues this rule doesn’t apply well to crypto. Instead, it suggests using risk-adjusted returns and the 200-day moving average for better insights.
As a notable example, bitcoin has fallen below its 200-day moving average, signaling a significant market shift. The COIN50 index, which tracks top non-Bitcoin tokens, has also dipped below this level, indicating potential prolonged weakness.
While Bitcoin’s decline has been moderate, altcoins have faced steeper losses. This gap highlights increased volatility in newer crypto sectors like memecoins and AI tokens. Coinbase believes relying solely on Bitcoin for market judgment is insufficient. Broader indicators like the COIN50 offer a clearer picture of investor sentiment.
Coinbase remains cautiously optimistic. It expects the market to bottom out by mid-to-late Q2 2025, with a possible recovery in Q3 if global conditions improve. Until then, it advises a cautious and flexible approach due to weaker liquidity and reduced risk appetite.
