Bullish and Bearish Signals for BTC, ETH, L2s

Crypto’s year-end setup still skews positive, according to Coinbase Institutional’s fourth-quarter 2025 “Charting Crypto: Navigating Uncertainty” report produced in collaboration with Glassnode.

The team characterizes its stance as cautious but biased higher after the Oct. 10 shakeout. Coinbase links the slide to heavy leverage meeting thin order books, then worsening when some exchanges’ auto-deleveraging capped market-maker shorts and drained liquidity. The firm says prices stabilized into the weekend, but the tape stayed tentative as macro jitters resurfaced.

Liquidity and macro sit at the center of Coinbase’s outlook.

The firm’s Global M2 Money Supply Index — which Coinbase says has historically tracked bitcoin and tends to lead by roughly 110 days — began the quarter in a supportive posture, though the report warns conditions could tighten later in Q4. Coinbase also anticipates two additional Federal Reserve rate cuts before year-end, a shift it believes could coax some cash out of money-market funds and back toward risk.

Policy and market plumbing round out what Coinbase calls a constructive setup.

The report highlights stablecoin supply and monthly volumes at or near record levels — evidence, in Coinbase’s telling, that more payments and transfers are moving on-chain. It also notes that U.S. spot ETF infrastructure for bitcoin and ether continues to deepen, improving access for traditional allocators and strengthening market depth. These developments, Coinbase argues, are less about headlines and more about rails that keep usage and liquidity flowing through volatility.

On positioning, Coinbase favors bitcoin, citing its “digital gold” role amid persistent doubts about fiscal and monetary discipline. The report says ether looks constructive as well: scaling progress has pushed more activity to layer-2 networks while fees have fallen, and sentiment has improved since earlier in the year. An investor survey included in the report shows a majority of institutions bullish on BTC over the next three to six months, even as many flagged the macro backdrop as the top risk.

Coinbase devotes space to digital-asset treasury companies (DATs), describing them as meaningful, relatively steady buyers of BTC and ETH. The firm says that the cohort now holds a notable share of the circulating supply and remains an important source of demand. At the same time, Coinbase acknowledges open questions around long-run business models — particularly after recent equity-market weakness in the group.

The report does not dismiss near-term hazards. Coinbase flags missing U.S. data tied to the government shutdown, the chance that liquidity fades in November and uncertainty around DATs as reasons to keep sizing and time horizons disciplined.

Even so, the bottom line from Coinbase Institutional is steady: liquidity conditions, policy progress and expanding on-chain usage — led by stablecoins and maturing ETF plumbing — remain supportive into year-end, with bitcoin best placed to lead if those supports hold.