Coinbase Report Signals Potential Q2 Bottom and Q3 Rebound Amid Cautious Crypto Outlook

A recent Coinbase report warns that the crypto market may be entering a new bear phase, yet suggests a potential bottoming between May and June 2025 with a possible recovery in Q3 if global conditions improve. The report highlights that, while Bitcoin’s decline has been modest with less than a 20% drop since December 2024, it has slipped below its 200-day moving average—a signal that longer-term market trends may be shifting. Meanwhile, the total market cap of non-Bitcoin tokens has fallen 41% from its December 2024 peak, and indices like Coinbase’s COIN50, which tracks the top 50 non-Bitcoin tokens, have similarly underperformed. The report also points to increased volatility in segments such as memecoins, DePIN projects, and tokens linked to artificial intelligence, underscoring the challenges in assessing market health by only following Bitcoin. Although venture capital in crypto remains significantly below the highs of the 2021–2022 cycle, Coinbase remains cautiously optimistic, urging investors to adopt a flexible and risk-aware approach in light of weaker liquidity and an overriding economic uncertainty.