- Coinbase Institutional believes the crypto bull run ended in late February/March 2024, with markets now in bear territory.
- Bitcoin dropped below its 200-day moving average in March, a key indicator of a bearish shift in long-term momentum.
- Recovery may begin mid-to-late Q2 2025, with alternative cryptocurrencies potentially facing a more severe winter due to decreased venture capital funding.
Coinbase’s institutional arm has indicated that the cryptocurrency bull run has concluded, with markets now heading into a bear cycle characterized by extended losses and stagnation. According to a note published Monday by David Duong, global head of research at Coinbase Institutional, technical indicators show that crypto entered bear market territory between late February and March 2024.
“The 200DMA model on bitcoin does suggest that the token’s recent steep decline qualifies this as a bear market cycle starting in late March,” Duong stated in the report. He added that the broader cryptocurrency market, represented by the COIN50 index of top tokens by market capitalization, has been “unequivocally trading in bear market territory since the end of February.”
Bear Market Indicators
Bitcoin slipped below its 200-day simple moving average (SMA) on March 9 and has remained below this key technical indicator, signaling a significant bearish shift in momentum. The 200-day SMA is widely used by analysts to determine long-term market trends, with persistent movements below this line typically indicating bear market conditions.
Duong addressed the challenges of identifying crypto bear markets, noting that while traditional stock markets define bear conditions as 20% declines, crypto markets routinely experience corrections of this magnitude. He argued that the arbitrary 20% threshold often fails to account for sentiment changes that can trigger defensive portfolio adjustments even during smaller, intense sell-offs.
Recovery Timeline and Alternative Metrics
Beyond the 200-day SMA, Duong highlighted bitcoin’s risk-adjusted performance measured in standard deviations (z-score) relative to average performance over the previous year as another effective method for identifying crypto bear markets. “Our [z-score] model indicates that the most recent bull cycle ended in late February. But it has since classified all subsequent activity as ‘neutral,’ highlighting its potential lag in rapidly changing market dynamics,” he explained.
The impending downturn could be particularly harsh for alternative cryptocurrencies due to a slowdown in venture capital (VC) funding. Despite bitcoin reaching new all-time highs earlier this year, exceeding the 2021 peak of $70,000, VC funding has remained 50-60% below 2021-22 levels, indicating reduced risk appetite in the ecosystem.
Looking ahead, Duong predicts that the crypto market “may find a floor in mid-to-late 2Q25 – setting up a better 3Q25,” suggesting investors should maintain a defensive stance on risk assets for the time being.
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