The Bitcoin price has observed a surge back above the $71,000 level during the past day as buyers appear to have returned on Coinbase.
Bitcoin Coinbase Premium Has Witnessed A Large Positive Spike
As explained by CryptoQuant author Axel Adler Jr in a post on X, the BTC Coinbase Premium Index has registered a high value recently. The “Coinbase Premium Index” refers to an indicator that keeps track of the percentage difference between the Bitcoin prices listed on Coinbase (USD pair) and Binance (USDT pair).
When the value of this metric is positive, it means the price of the cryptocurrency listed on Coinbase is greater than on Binance right now. Such a trend implies the presence of a higher buying pressure (or just a lower selling pressure) on the former exchange than the latter one.
On the other hand, the indicator being negative implies a larger amount of selling may be occurring on Coinbase than on Binance at the moment, which has pushed the price on the former to a lower value.
Now, here is a chart that shows the trend in the Bitcoin Coinbase Premium Index over the last few weeks:
The value of the indicator seems to have spiked quite high recently | Source: @AxelAdlerJr on X
As displayed in the above graph, the Bitcoin Coinbase Premium Index has been mostly at negative levels during the past couple of weeks. Prior to this red streak, the metric had seen a phase of positive levels. Interestingly, the price of the cryptocurrency had marched up alongside those green values. This would imply that the buying pressure on Coinbase may have helped fuel the rally.
Coinbase is widely known to be the preferred platform of the US-based institutional entities, while Binance hosts a more global traffic. As such, the index’s value can provide hints about how the behavior of these American whales differs from the rest of the world.
This year, these institutional investors have taken the center stage in the Bitcoin market with the approval of the spot exchange-traded funds (ETFs), with their movements reflecting on the BTC price. The earlier pattern of the potential buying pressure from these large American investors driving the rally is just one example of this trend seen at different points in the year.
As mentioned before, what has followed this accumulation has been negative values of the Coinbase Premium Index in the past two weeks or so. While this selling pressure hasn’t caused any significant bearish effects on Bitcoin, the coin has still been unable to mount any further upward moves.
One glimmer of hope, perhaps, may have appeared in the past day, as the indicator has registered a large positive spike. It’s unclear currently whether this is going to lead to another buying streak like last month or if it’s just a temporary deviation like the two short-lived spikes already witnessed in the past week.
Whatever the case be, though, Bitcoin has been able to enjoy some bullish momentum in the last 24 hours, likely at least in part because of this buying pressure.
BTC Price
In this latest fresh surge, Bitcoin has so far been able to climb towards the $71,300 level. It now only remains to be seen how long this run can continue.
Looks like the price of the asset has seen a surge over the last few days | Source: BTCUSD on TradingView
Featured image from Dall-E, CryptoQuant.com, chart from TradingView.com
