Coinbase Institutional Highlights Three Catalysts That Could Lift Crypto in Q4 2025

Core Viewpoint - The year-end setup for cryptocurrency remains positive, despite recent market volatility, according to Coinbase Institutional's report in collaboration with Glassnode [1] Market Conditions - Coinbase's stance is cautious but biased higher following the market shakeout on October 10, attributing the decline to heavy leverage and thin order books, which worsened due to auto-deleveraging on some exchanges [2] - Prices have stabilized, but market sentiment remains tentative amid macroeconomic concerns [2] Liquidity and Monetary Policy - The Global M2 Money Supply Index, which has historically tracked bitcoin, started the quarter in a supportive position, although tightening conditions are anticipated later in Q4 [3] - Coinbase expects two additional Federal Reserve rate cuts before year-end, which could encourage a shift of cash from money-market funds back into risk assets [3] On-Chain Activity - Stablecoin supply and monthly volumes are at or near record levels, indicating increased on-chain payments and transfers [4] - The infrastructure for U.S. spot ETFs for bitcoin and ether is improving, enhancing access for traditional investors and strengthening market depth [4] Investment Positioning - Coinbase favors bitcoin as "digital gold" amid ongoing concerns about fiscal and monetary discipline, while ether shows constructive signs due to scaling progress and improved sentiment [5] - An investor survey indicates a majority of institutions are bullish on bitcoin over the next three to six months, despite macroeconomic risks being a primary concern [5] Digital-Asset Treasury Companies - Digital-asset treasury companies (DATs) are described as significant and steady buyers of bitcoin and ether, holding a notable share of the circulating supply [6] - There are open questions regarding the long-term business models of DATs, especially in light of recent equity market weaknesses [6] Near-Term Risks - Coinbase acknowledges potential near-term hazards, including missing U.S. economic data due to the government shutdown and the possibility of fading liquidity in November [7] - Despite these risks, the overall outlook remains steady, with supportive liquidity conditions, policy progress, and expanding on-chain usage expected to continue into year-end [7]