Crypto Outlook for Year-End: Positive Signals for BTC, ETH, and Layer-2 Networks
Crypto Market Poised for Positive Year-End
Coinbase Institutional's fourth-quarter 2025 report, "Charting Crypto: Navigating Uncertainty," developed with Glassnode, suggests a favorable crypto market setup as the year concludes. The report describes a cautious optimism post the October 10 downturn.
Liquidity and Macro Factors
Liquidity and macroeconomic factors are central to Coinbase's perspective. The Global M2 Money Supply Index, which historically correlates with Bitcoin, started the quarter strong, but potential tightening is anticipated later in Q4. Coinbase predicts two Federal Reserve rate cuts by year-end, potentially redirecting funds from money markets to riskier assets.
Policy and Market Infrastructure
Stablecoin supply and trading volumes are near record highs, indicating increased on-chain transactions. Additionally, U.S. spot ETF infrastructure for Bitcoin and Ethereum is maturing, enhancing access for traditional investors and deepening market liquidity.
Investment Positioning and Sentiment
Coinbase is bullish on Bitcoin, viewing it as "digital gold" amid fiscal and monetary uncertainties. Ethereum also shows promise, with Layer-2 network growth and reduced fees. An investor survey reveals most institutions are optimistic about Bitcoin in the next three to six months, despite macroeconomic risks.
Digital-Asset Treasuries
Digital-asset treasury companies are significant, steady buyers of BTC and ETH, holding a substantial portion of the circulating supply. However, questions about their long-term business models persist, especially after recent equity market challenges.
Risks and Outlook
While Coinbase acknowledges short-term risks such as missing U.S. data from a government shutdown and potential liquidity declines in November, the overall outlook remains positive. Liquidity conditions, policy progress, and expanding on-chain usage, particularly through stablecoins and ETFs, support a strong year-end, with Bitcoin poised to lead.