Coinbase sees constructive Q1 outlook after late 2025 crypto market reset

Crypto markets have entered the opening months of 2026 on firmer structural footing following a late-2025 reset, according to the latest Charting Crypto report from Coinbase Institutional, which has highlighted improving positioning and a more balanced market environment heading into the first quarter.

Published quarterly, Charting Crypto is part of Coinbase Institutional’s research offering for professional investors and is designed to provide a visual, data-driven snapshot of broader crypto markets. While the report stops short of forecasting a decisive trend shift, it has suggested that the groundwork for a more durable 2026 is being laid following the Q4 reset.

"Our outlook on crypto markets is constructive to start the new year, even though the clouds from last year’s leverage-fueled liquidations have not cleared entirely," David Duong, global head of investment research at Coinbase Institutional, said. "Nevertheless, there are several reasons for optimism in Q1."

Beyond the reset

The quarterly report combines onchain metrics with global investor survey data to map how market structure, participation, and risk appetite have evolved following the volatility seen late last year. Per Coinbase Institutional, the fourth-quarter drawdown helped flush excess leverage and speculative positioning that had accumulated earlier in the cycle, leaving markets in a healthier state.

Rather than signaling a return to aggressive risk-taking, the report has argued that the current environment suggests recalibration. Investor engagement has shown sustained activity but is more selective, with positioning described as less crowded and more disciplined than during prior expansion phases. According to the firm, this landscape has reduced downside fragility and left markets better positioned to absorb shocks.

Onchain data cited in the report also showed supply dynamics becoming more orderly, with fewer signs of panic selling and a gradual normalization of holder behavior. At the same time, the appetite for derivatives has reflected restraint, with leverage usage more contained and positioning less one-sided than during earlier rallies.

Coinbase Institutional also pointed to macro conditions as a moderating influence. While uncertainty around monetary policy, geopolitics, and regulation has persisted, the report said those risks have increasingly been absorbed into positioning rather than triggering abrupt dislocations, contributing to more measured market reactions.