You’re reading Crypto for Advisors, CoinDesk’s weekly newsletter that unpacks digital assets for financial advisors. Subscribe here to get it every Thursday.

Happy Thursday, advisors!

In today’s newsletter, Joshua de Vos and Jacob Joseph of CoinDesk Research break down how digital assets turned around in Q3, outperforming stocks and gold.

Then, in “Ask an Expert,” Kevin Tam explains crypto perpetuals.

Have three minutes? Mesh is conducting a 2026 State of Digital Money Survey to understand how financial institutions, digital-asset businesses and infrastructure providers experience regulatory fragmentation across markets. Responses are anonymous and results will be shared in this newsletter. (edited)

Happy reading.

- Sarah Morton

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Digital assets ended a three-quarter losing streak in Q3

Digital assets rebounded sharply in the third quarter of 2026, ending three consecutive quarters of losses and delivering their strongest performance of the year. As presented in CoinDesk’s latest Quarterly Review and Outlook, the recovery was shaped by easing geopolitical pressure, a more constructive liquidity backdrop and the return of institutional flows.

Q3 in review

The CoinDesk 20 (CD20) rose 52.7% to 2,447, while bitcoin gained 42.7% to $83,554. After a second quarter in which crypto sat out the broader risk-asset rally, the roles reversed. The S&P 500 and Nasdaq rose just 2.03% and 0.85%, and gold added 3.84%; digital assets were the clear outperformer by a wide margin.

BTC vs Gold vs SPX vs Nasdaq vs the CoinDesk 20 Index, Q3 2026

Several forces lined up to drive this recovery. Middle East tensions remained elevated but eased from second quarter levels, while the U.S. Treasury’s expansion of longer-dated bond buybacks in August revived the “debasement trade” narrative, which some described as a form of “mini quantitative easing.” Regulatory clarity and the rapid growth of tokenized equities were additive to market sentiment, reinforcing the convergence between traditional finance and digital-asset infrastructure.

ETF flows: the reversal

Bitcoin spot ETFs best represented this renewed positivity in the industry during the third quarter. After $4.67 billion of net outflows in the second quarter, inflows returned with strength: $3.54 billion in August, the highest monthly total since July 2025, followed by $2.65 billion in September. Third quarter net flows reached $6.36 billion, an $11 billion swing from the prior quarter. In the second quarter the question was whether institutions were leaving; the third quarter suggests they were simply waiting on the sidelines for macro catalysts to emerge.

Monthly ETF net flows: BTC, ETH, SOL, 2024 — present

Constituent highlights

The CoinDesk 100 (CD100) rose 53.3% to 1,890 and the CoinDesk Memecoin Index (CDMEME) rose 45.9% to 324, while the CoinDesk 5 (CD5) gained 46.7% to 1,406, trailing the CD20 by six points.

The CoinDesk 80 (CD80) led the multi-asset CoinDesk indices, rising 57.4% to 559 and outperforming bitcoin by roughly 14.7 percentage points, with Zcash extending its second quarter momentum as interest in privacy assets continued.

All 20 CD20 constituents finished the quarter positive. Uniswap (UNI) led with a 220% gain, followed by NEAR at 200%, last quarter’s top performer, while Chainlink and Aave rose 100% and 87.5%.

Twelve assets outperformed the index, including Cardano (ADA, 71.0%), Ether (ETH, 70.9%), Sui (SUI, 68.8%), Avalanche (AVAX, 67.5%) and Solana (SOL, 60.5%). Despite strong gains across the board, there was a clear disparity across the return tails, with top performers breaking away materially.

CoinDesk 20 constituents: Q3 2026 performance

Looking ahead to Q4

Macro conditions still drive prices. While easing Middle East tensions helped risk sentiment, sharp long-end Treasury yield spikes tightened financial conditions once again. Treasury buybacks partially offset this, improving liquidity conditions for assets like bitcoin.

Institutional demand expanded into digital asset treasury companies (DATs). Despite earlier concerns over Strategy’s sale of ~7,000 BTC, the market recovered, and Strategy resumed net buying, pushing holdings above pre-sale levels by late September. Combined with renewed ETF inflows, DAT accumulation signals strong net demand.

Bitcoin’s 42.7% third quarter gain following three down quarters suggests a transition from post-peak correction toward accumulation in the four-year cycle ahead of the 2028 halving. Spot ETFs and clearer regulations further strengthen demand. Meanwhile, expanding on-chain real-world asset trading volume remains a key catalyst signaling clear convergence with traditional finance.

Lastly, the third quarter highlighted the value of broader exposure. Outperformance by several CD20 and CD80 assets over bitcoin highlights a market driven by protocol fundamentals and asset-specific catalysts, making benchmarks like the CD20 and CD100 effective tools for capturing dispersion.

This summary was created based on CoinDesk Research’s latest report; Digital Assets: Quarterly Review and Outlook, Featuring CoinDesk 5 and CoinDesk 20.

- Joshua de Vos,lead and Jacob Joseph, research analyst, CoinDesk Research

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Ask an Expert

Q: What is a perpetual future?

A perpetual future, or perp, is essentially a bet on price direction, whether an asset will go up or down, without owning the asset itself. It’s a type of derivative contract that does not have an expiry date.

Specifically, crypto perpetual futures are designed to track underlying spot market prices while having no fixed end or delivery date. This means traders can hold positions indefinitely without having to roll the contract over.

Q: Who invented perps?

The theoretical framework for perpetual contracts was introduced in 1993 by Robert Schiller, a prominent economist at Yale University. He originally conceptualized this financial instrument to address the lack of a viable hedging mechanism for real estate assets that are difficult to price daily.

Q: How are perpetuals regulated in the U.S.?

To trade legally in the U.S., these products must follow a specific three-part regulatory framework:

• Designated Contract Markets (DCMs): the exchanges licensed by the CFTC where future contracts are actively traded.
• Derivatives Clearing Organizations (DCOs): the clearinghouses that sit between buyers and sellers to settle trades and payouts.
• Futures Commission Merchants (FCMs): the brokers that act as intermediaries executing trades on behalf of clients for futures and options contracts.

In May 2026, the CFTC created a framework to bring perpetual futures onto regulated U.S. exchanges under the Commodity Exchange Act. This marks a broader shift as perpetuals move from a crypto-native novelty to a CFTC regulated asset class. Their integration into mainstream U.S. infrastructure signals a fundamental shift towards continuous, 24/7 markets for both digital and traditional assets. Perpetual futures were designed for crypto, a market that never closes. Regulators are now determining which of their features are safe for use in traditional markets,

- Kevin Tam, digital asset research specialist

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Keep Reading

• The U.S.Treasury Department has scrapped a proposal that would have forced banks and crypto businesses to collect and report more information when customers sent large amounts of crypto to wallets they controlled themselves.
• The Cardano Foundation has launched a token standard that lets issuers of stablecoins, funds and bonds decide who can receive their assets, and freeze or seize holdings when the rules require it.
• Robinhood announced a $25 million bitcoin treasury purchase, the company’s first.

Looking for more? Receive the latest crypto news from coindesk.com and market updates from coindesk.com/institutions.