Moving the Bitcoin and Coin50 Index below the 200-day average signal potential Crypto Bear Market: Coinbase Institutional

The Crypto Bull Run can be completed, with the market preparing for a winter characterized by prolonged losses and disruption, according to Coinbase’s institutional arm.

“The 200DMA model in Bitcoin suggests that the recent steep decline of the token qualifies it as a bear market cycle starting in late March. But the same exercise conducted at the Coin50 Index (which includes the top 50 tokens through market capitalization) show February, “David Duong, Global Head of Research at Coinbase Institutional, said in a note Published Monday.

Bitcoin slipped under the 200-day simple moving average (SMA) on March 9 and since the establishment of a foothold below the same with a sign of a lasting bearish shift in momentum. The 200-day SMA is widely monitored to measure long-term trends, with constantly moving above the same, representing a bull market and vice versa.

Duong noted this observation while addressing the challenges of recognizing a crypto bear market, where 20% or more corrections are routine. In contrast, a 20% decline is commonly used to define bear markets in stock markets.

The report argued that arbitrary 20% often failed to account for a tooth in the investor’s sentiment and results in portfolio adjustments enlarged by smaller, more intense sellers.

“Nakita namin noong nakaraan na ang pagtanggi na hinihimok ng damdamin ay madalas na mag-trigger ng mga pagtatanggol na pagsasaayos ng portfolio, sa kabila ng hindi pagtugon sa di-makatwirang 20% ​​​​na threshold. Sa madaling salita, naniniwala kami na ang mga merkado ng bear ay panimula ay kumakatawan sa mga pagbabago sa rehimen sa istruktura ng merkado-na nailalarawan sa pamamagitan ng pagkasira ng mga pundasyon at pag-urong ng pagkatubig-sa halip na ang kanilang porsyento na Refusal, “Duong mentioned.

In addition to the 200-day SMA, Duong featured performance that suited the risk of Bitcoin measured in standard deviations (Z-Score) associated with average performance in the past 365 days as another effective method for recognizing crypto bear markets.

“Our (Z-Score) model suggests that the latest bull rotation ended in late February. But since the classification of all subsequent activities as” neutral, “emphasizing the potential lag with the rapid change of dynamics in the market,” said Duong, who called for a defensive bearing at the rising asses for the time.

The upcoming winter may be more cruel for alternative cryptocurrencies considering slowing down the venture capital fund (VC).

While the BTC has set new highs early this year, which is more than 2021 top of $ 70K, the bullish trend has failed to inspire the more risk of getting into the VC space, leaving the overall funding 50% -60% below 2021-22 levels.

Duong said the crypto market “could find a floor mid-late 2Q25-setting up a better 3Q25.”