Data shows that the bitcoin Coinbase premium gap has recently turned positive, a sign that institutional entities have started buying the asset again.
bitcoin Premium on Coinbase Has Been Positive Throughout the Latest Rally
As noted by one analyst in a CryptoQuant Quicktake bitcoin-purchases-increase-again” target=”_blank” rel=”noopener nofollow”>mailCoinbase's premium gap, which had negative values just before, has recently turned positive again.
He “bitcoin-purchases-increase-again” target=”_blank” rel=”noopener nofollow”>Coinbase Premium Gap” here refers to an indicator that tracks the difference between bitcoin prices listed on cryptocurrency exchanges Coinbase (USD pair) and Binance (USDT pair).
When the value of this metric is positive, it means that the price of the asset listed on Coinbase is higher than the one listed on Binance at the moment. This trend implies that the former platform is currently experiencing greater buying pressure than the latter.
On the other hand, the fact that the indicator is below zero suggests that Coinbase may be facing greater selling pressure compared to Binance at the moment.
Now, here's a chart showing the trend in the Coinbase bitcoin premium gap over the past few weeks:
<img decoding="async" class="alignnone aligncenter" src="https://technicalterrence.com/wp-content/uploads/2024/07/Bitcoin-at-63000-as-institutional-buyers-return-to-Coinbase.png" alt="Coinbase Premium Gap on bitcoin” width=”1280″ height=”707″ data-recalc-dims=”1″/>
The value of the metric appears to have been going up in recent days | Source: bitcoin-purchases-increase-again" target="_blank" rel="noopener nofollow">CryptoQuant
As you can see in the chart above, the Coinbase Premium bitcoin Gap had been in negative territory throughout the last third of June and the first few days of this month.
During this period, the btc price faced bearish momentum, which eventually culminated in a drop below the $54,000 level. This would imply that selling pressure on Coinbase may have been a factor behind the asset’s downward trajectory.
It is clear from the chart that after the drop, the metric moved closer to neutral levels, suggesting that Coinbase and Binance no longer differed in selling or buying levels.
Over the past few days, the indicator has turned green, meaning that Coinbase users have started engaging in a larger amount of buying than those on Binance. Along with this latest buying pressure, btc has recorded a recovery surge towards the $63,000 mark.
Coinbase is popularly known to be the preferred platform for US-based institutional entities, while Binance hosts more global traffic. As such, Coinbase’s premium gap can be seen as reflecting how US whales differ in behavior from the rest of the investors.
Therefore, the return of positive values of the metric would indicate that these institutional holders would now have started accumulating the cryptocurrency again.
However, it remains to be seen whether this green premium is the start of a new trend for bitcoin or just a temporary deviation from the previous pattern of selling by US institutional investors.
btc Price
bitcoin had broken above the $63,000 level earlier in the day, but the asset has since seen a minor pullback to the $62,700 mark.
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Looks like the price of the coin has sharply gone up over the past day or so | Source: BTCUSD on TradingView
Featured image by Dall-E, CryptoQuant.com, chart by TradingView.com
