Coinbase Predicts Crypto Market Recovery in Q3 2025

Coinbase’s April market review paints a bearish picture of the current crypto landscape. The altcoin market capitalization dropped 41% from $1.6 trillion in December 2024 to $950 billion by mid-April.

According to BTC Tools, it briefly hit $906.9 billion on April 9 and hovered around $976.9 billion at the time of writing. Venture capital inflows to crypto projects have also fallen by 50–60% compared to previous years.

Warning Signs Point to a New ‘Crypto Winter’

David Duong, Coinbase’s Head of Research, suggested that a new crypto winter may be forming. Negative sentiment is rising due to global tariffs and geopolitical uncertainties, he noted.

Lower venture funding is restricting capital inflows, especially in the altcoin sector. This stalls innovation and slows growth across the ecosystem.

Broader Economic Forces Fuel Investor Caution

The report links this stagnation to macroeconomic instability and tighter fiscal policies. Tariffs and higher interest rates are discouraging risk investments, including crypto.

Yet, Duong remains optimistic about a reversal in H2 2025. If market sentiment shifts, it could happen rapidly and forcefully.

Technical Indicators Support Bear Market Assessment

Key indicators like the 200-day moving average and Bitcoin Z-score confirm the downturn. The Z-score compares current and historical valuations to detect overbought or oversold levels.

Although slow to react, this metric accounts for crypto’s volatility. Coinbase views the 200-day average as a more reliable trend indicator.

Bitcoin No Longer Reflects Broader Crypto Trends

Duong argues that Bitcoin is becoming less of a crypto market benchmark. As sectors like DeFi, DePIN, and AI grow, they drive trends independent of Bitcoin.

Coinbase’s model shows that the bear market began in late February 2025. Still, a more holistic market view is needed to define cycles in today’s diverse crypto landscape.