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With just 18 days to the close of 2025, Coinbase Institutional sheds light on market macro dynamics that might shape 2026.
In a tweet, Coinbase Institutional indicated that the market's liquidity boost seems to be arriving sooner than expected, with reserve growth likely continuing until April 2026.
This week, the Fed slashed its borrowing rate by a quarter-percentage point on Wednesday, taking it to a range between 3.5%-3.75%. This, according to Coinbase, was expected, with the central bank's plan to make reserve management purchases (RMP) of U.S. T-Bills over the next 30 days being constructive news.
Coinbase highlights a liquidity boost coming sooner, with reserve growth expected to continue till April 2026. The Fed's transition from balance sheet runoff to net injection is seen as "light quantitative easing" or "stealth QE," which, according to Coinbase, may support crypto markets.
Coinbase predicts a less hawkish environment than expected, given the reserve management purchases (RMP) of U.S. T-Bills coupled with Fed funds futures indicating two cuts (50bps) in the first nine months of 2026, which is beneficial for cryptocurrencies.
Everything lining up for massive 2026
In a recent tweet, Bitwise CEO Hunter Horsley predicted that the current developments in the market are lining up for a massive 2026, adding, "It's stunning."
In light of this, the Bitwise CEO believes that the market has changed and matured, with the four-year cycle dead.
Horsley pointed out something that might come as a surprise, saying, "We will look back on 2025 and realize that it's been a bear market since February, masked by the relentless bid from DATs and Bitcoin Treasury Companies."
Markets in mildly bearish phase
The crypto market remains in a weakened position after enduring a weeks-long sell-off that began in early October with a major liquidation event, which wiped out about $19 billion in leveraged bets.
Bitcoin trades near the lower boundary of its recent trading range, with any increase in the price being met by selling from investors who bought the largest cryptocurrency near the all-time high reached in early October.
Crypto analytics firm Glassnode said various metrics point to a "mild bearish phase," defined by modest capital inflows outweighed by steady selling pressure from larger holders.
Dan Burgin
Vladislav Sopov
U.Today Editorial Team