Coinbase Warns of Impending Crypto Winter as Macroeconomic Pressures Intensify
In its latest market analysis report dated April 2025, leading cryptocurrency exchange Coinbase has highlighted concerning indicators suggesting the potential onset of another crypto winter. The assessment points to tightening monetary policies across major economies, declining institutional inflows, and reduced retail participation as key factors contributing to this bearish outlook. Technical charts across major digital assets show weakening momentum following the recent market cycle peak, with trading volumes continuing their downward trajectory since Q1 2025. Market analysts note particular concern around the shrinking total value locked (TVL) in DeFi protocols and depressed NFT trading activity, both of which typically serve as leading indicators for broader market sentiment. While Bitcoin’s hash rate remains near all-time highs, the divergence between network fundamentals and price action has raised questions about sustained downward pressure. Coinbase’s research team emphasizes that traditional market correlations appear to be strengthening, with crypto assets increasingly moving in tandem with risk-off periods in equity markets.
Venture Capital Bailing on Crypto
The report pointed to global economic headwinds, particularly the resurgence of tariffs and ongoing fiscal tightening, as key contributors to the market’s decline. These factors have amplified uncertainty and triggered a risk-off attitude across financial markets, which, in turn, has fresh capital inflows into crypto.
Despite a modest quarter-over-quarter uptick in venture capital activity during Q1 2025, Coinbase observed that funding remains 50-60% below the heights of the 2021-22 bull cycle. This has especially hurt altcoin projects that rely on speculative inflows.
Further adding to the bearish signals, both Bitcoin and the COIN50 index, which tracks the top 50 tokens by market cap, have broken below their respective 200-day moving averages (200DMA), often seen as a technical sign of a prolonged downtrend.
As such, Coinbase’s global head of research, David Duong, believes that these converging indicators echo the onset of prior crypto winters and highlight the need for a “defensive stance.” While there is cautious Optimism for stabilization in mid-to-late Q2 2025, the path to a broader recovery remains clouded by macroeconomic uncertainty and weak performance in traditional equity markets.
“For now, the challenges of the current macro environment require greater caution.”
‘No Demand, No Rally’
Ecoinometrics highlighted similar concerns from an institutional perspective, pointing to weak demand and tightening financial conditions, and the Fed showing no signs of a pivot. This, as per the crypto data platform, is in no way a bullish backdrop.
ETF flows reflect this, with persistent outflows since late March and only occasional, modest inflows. Net flows over the past 30 days hover around zero. As such, short-term upside remains limited. This fragile backdrop could leave Bitcoin’s price vulnerable if market volatility returns.
