Coin Metrics has shared key insights on recent significant developments in the Bitcoin (BTC) and crypto space. The researchers from Coin Metrics have shared several important notes on major crypto events and what to anticipate as we close out this current year and head into 2026.
The research team at Coin Metrics has shared some key takeaways:
Demand from major absorption channels like ETFs and DATs has recently softened, while October’s deleveraging and a risk-off macro backdrop continue to pressure digital asset markets.
Leverage has reset across futures and DeFi lending markets, leaving positioning cleaner and reducing systemic vulnerabilities.
Spot liquidity has yet to recover across majors and altcoins, keeping markets fragile and more susceptible to outsized price moves.
Coin Metrics stated in their report that “Uptober” began rather quite strongly as Bitcoin cruised to new all-time highs. But the research report also pointed out that optimism quickly “reversed with October’s flash crash putting a dent in market sentiment.”
Since then, Coin Metrics noted that BTC has fallen by “around ~$40K (over 33%), while altcoins have been further hit, bringing the total market cap down to near $3T.”
Even with a year full of fundamental developments, “price action and sentiment have sharply diverged.”
Digital assets appear to be caught “at the intersection of external and intrinsic forces.”
On the macro front, the overall uncertainty “around Dec rate cuts and weakness in technology stocks has compounded risk-off behavior.”
Within crypto, demand channels like ETFs and digital asset treasuries (DATs), which have acted “as steady absorbers, have seen some outflows and cost basis pressure.”
Meanwhile, the October 10, 2025 liquidation cascade that “triggered one of the sharpest deleveraging events is having lingering ripple effects as market liquidity remains shallow.”
Coin Metrics also stated that the performance of Bitcoin has “increasingly diverged from major asset classes.”
Gold has powered ahead with year-to-date “returns exceeding +50% amid record central bank buying and ongoing trade tensions, while technology equities (NASDAQ) lost momentum in Q4 as markets reassessed the probability of upcoming Fed rate cuts and the sustainability of AI-driven valuations.”
As their previous research highlighted, BTC typically has “an oscillating relationship with both “risk-on” tech and “safe-haven” gold, shifting with the prevailing macro regime.”
According to the report from Coin Metrics, this makes it “sensitive to market shocks or catalysts, such as the October flash crash and the latest bout of risk-off sentiment.”
With Bitcoin serving as the anchor for the broader crypto market, its drawdown has “spilled over into other assets, as they continue to move closely in step with BTC despite short bursts of outperformance from themes like privacy.”
Bitcoin’s recent weakness is said to be partly driven “by softer demand from the channels that supported the asset through much of 2024 and 2025.”
ETFs have now seen multi-week net outflows of “$4.9B since mid-October, the largest bout of redemptions since Apr 2025 when BTC fell toward $75K ahead of the “Liberation Day” tariff announcements.”
Despite near term outflows, on-chain holdings continue “to be in an uptrend, with BlackRock’s IBIT ETF alone holding 780K BTC, ~60% of all current supply in spot Bitcoin ETFs.”
A return to sustained inflows would signal that “this channel is stabilizing, as ETF demand has historically acted as a key absorber of supply when risk appetite improves.”
Digital asset treasuries (DATs) are also showing “signs of strain.”
As prices pull back, the value of their shares and crypto holdings compresses, pressuring “the premium to NAV that underpins their growth flywheel.”
This reduces their capacity to raise capital “through equity issuance or debt, limiting their ability to increase crypto holdings per share.”
Smaller and newer DATs are especially sensitive “to this dynamic, as shifting market conditions can make cost-basis and equity valuations unfavorable for further accumulation.”
Strategy, the largest DAT currently owns “649,870 BTC (~3.2% of Bitcoin’s current supply) at an average cost of $74,333.”
Strategy’s accumulation accelerated “when BTC was rising and its equity valuation was strong, and has slowed, rather than being a source of active selling.”
Despite this, Strategy still sits “on unrealized gains, with its cost basis below the current market price.”
While Strategy could face pressure if prices “fall further or from potential index-exclusion risks, a reversal in market conditions could improve balance-sheet strength and valuations, restoring an environment that supports aggressive accumulation from DATs.”
This appears consistent with the “on-chain profitability trends.”
Short-term holder SOPR (<155 days)…