Bitcoin and Leading Altcoins Enter Bear Territory, Signaling Arrival of Crypto Winter: Coinbase Institutional

Coinbase Flags Start of Crypto Winter as Bearish Momentum Grips Market

Traditional definitions of a bear market may be losing their relevance in crypto, where sentiment shifts and liquidity crunches often precede major price declines, according to Coinbase Institutional’s latest report.

The firm suggests the recent crypto rally has run its course, with signs now pointing toward a new phase marked by prolonged weakness—a potential crypto winter.

“Bitcoin’s breakdown below its 200-day moving average in early March signals a transition into bearish territory,” wrote David Duong, Coinbase Institutional’s Head of Research. “But looking beyond BTC, our COIN50 index shows that the broader crypto market has been entrenched in a bear market since late February.”

The 200-day simple moving average (SMA) is a widely followed indicator for identifying long-term trends. Persistent trading below that line often signals that bullish momentum has faded. Bitcoin dipped below the threshold on March 9 and has failed to reclaim it, underscoring the shift in sentiment.

However, Duong cautions that relying solely on traditional metrics—like the 20% decline benchmark used in equity markets—may not be adequate for crypto, where extreme volatility is the norm. Instead, smaller yet sharper sell-offs, fueled by changing sentiment, can trigger significant portfolio rebalancing before a 20% drop even registers.

“Bear markets in crypto aren’t just about percentage losses,” Duong wrote. “They represent deeper structural shifts—worsening fundamentals, declining liquidity, and eroding confidence. These regime changes matter more than hitting any specific numerical threshold.”

In addition to the 200DMA, Coinbase also monitors a z-score model that measures Bitcoin’s risk-adjusted returns relative to its trailing 12-month average. That model pegged the end of the bull market in late February, and since then, it has reflected neutral market activity—highlighting the lag that can come with quantitative tools in fast-moving environments.

Adding to the pressure is the continued slump in venture capital funding. Even with Bitcoin briefly topping $70,000 earlier this year, early-stage investment in the crypto space has failed to rebound. Current VC activity remains 50–60% below the peak levels seen in 2021 and 2022, casting doubt on the outlook for altcoins and emerging blockchain projects.

Still, Duong sees a possible turning point on the horizon. “We think the market could establish a bottom by mid-to-late Q2, potentially laying the groundwork for a stronger second half of the year,” he noted.