Core Insights - Coinbase indicates that the crypto market is preparing for a reset after experiencing two months of significant bearish pressure [1][4] - Institutional speculation has decreased from 10% in November to approximately 4% currently, suggesting a stabilization in the market [1][6] - The systemic leverage ratio has dropped from around 10% in the summer to about 4%-5% today, which Coinbase considers a stable and sustainable level [2][5] Market Dynamics - The decline in the systemic leverage ratio is crucial as institutions are major players in structured derivatives volume, including OTC desks, ETFs, swaps, and prime brokerage [6] - The recent sell-offs, driven by cascading liquidations, are beginning to fade, indicating a potential recovery in the market [3][10] - Coinbase attributes the turbulence in November to a market purging excess leverage rather than signs of collapse [5] December Outlook - Historically, December has been a bullish month, with an average return of 25% during bull markets, suggesting a potential for a rally following the recent downturn [4][7] - Despite the strong historical performance, 2025 has shown unusual patterns, with October and November being particularly weak [7] - The contraction in BTC/ETH/SOL perpetual futures open interest by 16% month-over-month and significant outflows from U.S. spot ETFs indicate a cautious approach from institutional investors [8][9]