Bitcoin and cryptocurrencies have started to recover in recent days after unexpectedly experiencing sharp declines in October and November.
This has reignited hopes for a strong and sustained rally above $100,000, with Coinbase’s institutional analysts outlining a positive scenario for December.
Analysts believe November's correction paved the way for market recovery towards the end of the year, citing reduced business speculation and a return to stability.
Analysts at Coinbase noted that the systemic leverage ratio, which tracks institutional investor speculation, has fallen almost dramatically from 10% in November to about 4% and is starting to stabilize.
Analysts note that Bitcoin and the crypto market are now well positioned for an uptrend after two months of intense downward pressure.
Analysts said the latest data could point to a bull market rally in December after two months of sharp declines.
“A difficult November can lead to an unforgettable December.”
The lower the leverage, the healthier the market is and the less it reacts to sudden declines.
Coinbase analysts also pointed to several important signals that emerged in November.
The number of open positions in BTC/ETH/SOL perpetual futures decreased by 16% on a monthly basis. This means fewer leveraged positions remain open and leverage has decreased.
During the same period, there were large outflows from US spot ETFs. There was about $3.5 billion in outflows from Bitcoin ETFs and $1.4 billion outflows from Ethereum ETFs. Major investors withdrew.
According to Coinbase, these are not signs of collapse, but rather that the market is becoming less overleveraged and stabilizing. In other words, financial institutions have put on the brakes, but they have not abandoned the market.
What does December mean for Bitcoin?
According to the data, December has historically brought strong returns in the post-halving bull market, with Bitcoin's average gain of 25%.
However, 2025 repeatedly defied seasonality expectations. Historically, October and November, the months with the biggest price increases, were the worst months since 2018.
In conclusion, despite all the sharp declines we have experienced, Coinbase argues that if macroeconomic conditions remain favorable, a cleaner and more stable market structure could pave the way for a strong recovery towards the end of the year.
*This is not investment advice.
