The crypto market shows signs of a potential Q1 recovery following December's sell-off, Coinbase analysis suggests. Spot Bitcoin ETFs saw mixed inflows, while Ethereum ETFs showed more positive trends, indicating cautious institutional re-entry. Systemic leverage, measured by futures open interest relative to market cap, appears reduced for Bitcoin, suggesting less market fragility. However, Ethereum's higher leverage ratio implies potential fragility in rallies. Improved order book liquidity and a shift in options sentiment also point to market stabilization. For a sustained Q1 bounce, the market needs consistent weeks of net inflows, according to reports.

The crypto market shows signs of a potential Q1 recovery following December's sell-off, Coinbase analysis suggests. Spot Bitcoin ETFs saw mixed inflows, while Ethereum ETFs showed more positive trends, indicating cautious institutional re-entry. Systemic leverage, measured by futures open interest relative to market cap, appears reduced for Bitcoin, suggesting less market fragility. However, Ethereum's higher leverage ratio implies potential fragility in rallies. Improved order book liquidity and a shift in options sentiment also point to market stabilization. For a sustained Q1 bounce, the market needs consistent weeks of net inflows, according to reports.