A survey by Coinbase Institutional and Glassnode reveals that one in four institutions believes cryptocurrency has entered a bear market, yet the majority still views bitcoin as undervalued. Despite caution, most institutions have held or increased their bitcoin exposure since October 2025. This positioning reflects a preference for bitcoin amid broader market deleveraging.
In a global investor survey conducted by Coinbase Institutional and Glassnode, published on February 1, 2026, 25% of institutions agreed that the crypto market has entered a bear market. However, 70% of respondents stated that bitcoin remains undervalued, highlighting a disconnect between short-term regime perceptions and long-term value assessments.
The survey captures institutional strategies amid recent volatility. Bitcoin dominance edged up from 58% to 59% in the fourth quarter of 2025, indicating stability in the largest cryptocurrency even as altcoins faced significant deleveraging in October. Institutions have largely maintained or boosted their bitcoin allocations since then, concentrating risk in bitcoin over smaller, more volatile tokens.
David Duong, global head of research at Coinbase Institutional, explained this paradox in an interview: "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." He emphasized that bear market labels describe current risk appetite and liquidity conditions, not bitcoin's ultimate value.
Derivatives data supports this view. For the first time, bitcoin options open interest surpassed perpetual futures open interest, with the 25-delta put-call skew in positive territory for 30-, 90-, and 180-day expiries. Duong noted: "Institutions increasingly expressed views via options and basis trades, which give convexity or carry without the same liquidation risk that drove the October move."
On-chain metrics show sentiment shifted from 'Belief' to 'Anxiety' in October, per entity-adjusted NUPL, but without reaching capitulation. Bitcoin moved within three months rose 37% in Q4 2025, while long-term holdings fell 2%, signaling a distribution phase among large holders.
Institutions increasingly treat bitcoin as a strategic store-of-value and macro hedge, rather than a speculative asset. The report favors larger-cap tokens in Q1 2026, with macro factors like liquidity and policy overshadowing the traditional four-year halving cycle. Duong added: "The four-year cycle is still a reference point, but mostly as a behavioral template rather than a hard model."
Macro tailwinds include December 2025 CPI at 2.7% and projected 5.3% real GDP growth for Q4 2025. A custom Global M2 index leads bitcoin prices by 110 days with a 0.9 correlation, reinforcing the undervaluation thesis if liquidity conditions improve.
