Bitcoin Institutions Admit Bear Market, But See Price as Undervalued

Coinbase Institutional survey shows institutions are cautious but still bullish on Bitcoin's long-term value proposition

Feb. 1, 2026 at 7:55am

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A recent survey from Coinbase Institutional and Glassnode found that 1 in 4 institutions agreed that crypto has entered a bear market. However, the majority of institutions still said Bitcoin was undervalued, and most said they had held or increased exposure since October. This discrepancy highlights how institutions are positioning - cautious about the current market regime but still convinced of Bitcoin's long-term value.

Why it matters

This report captures the institutional view on the current state of the crypto market, showing a willingness to stay allocated to Bitcoin despite bearish short-term sentiment. It provides insights into how institutions are navigating the market, shifting away from risky leverage towards more measured strategies like options and basis trades. Understanding the institutional perspective is crucial as they represent a significant source of capital and influence in the crypto ecosystem.

The details

The report found that while 1 in 4 institutions agreed crypto is in a bear market, the majority still view Bitcoin as undervalued. This is because institutions are assessing Bitcoin's value based on long-term factors like adoption, scarcity, and improving market structure, rather than just short-term price action. The report also noted a shift in derivatives activity, with options open interest spiking as traders sought downside protection, and perpetual futures open interest falling. On-chain data showed a distribution phase, with more active Bitcoin moving compared to dormant supply. Institutions are increasingly treating Bitcoin as a strategic, macro hedge rather than a speculative asset.

  • In the fourth quarter of 2025, Bitcoin's dormant supply (BTC unmoved for more than a year) fell by 2%, while its active supply (BTC moved within three months) rose by 37%.
  • December 2025 CPI held at 2.7%, and the Atlanta Fed GDPNow projected 5.3% real GDP growth for Q4 2025.

The players

Coinbase Institutional

A division of the cryptocurrency exchange Coinbase that provides services and research for institutional investors.

Glassnode

A blockchain analytics firm that provides data and insights to the crypto industry.

David Duong

The global head of research at Coinbase Institutional.

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What they’re saying

“When institutions assess Bitcoin's value, they look beyond near-term price action to factors such as adoption, scarcity, improving market structure, and clearer regulatory frameworks.”

— David Duong, Global Head of Research, Coinbase Institutional (CryptoSlate)

“Unlike retail participants, who often focus on short-term price movements and market cycles, institutions place less emphasis on timing and more on Bitcoin's long-term value proposition.”

— David Duong, Global Head of Research, Coinbase Institutional (CryptoSlate)

What’s next

The judge in the case will decide on Tuesday whether or not to allow Walker Reed Quinn out on bail.

The takeaway

This report highlights how institutions are navigating the current crypto market environment, shifting their focus from short-term price movements to Bitcoin's long-term value proposition. Despite bearish sentiment, institutions remain bullish on Bitcoin's potential as a strategic, macro hedge, underscoring the asset's growing maturity and institutional adoption.