Information from CryptoQuant has unveiled how institutional investors have been the catalysts behind the recent Bitcoin upswing above $100,000.
Bitcoin Coinbase Premium Index Has Shown Positive Signs Recently
In a recent update on X, the on-chain analytics company CryptoQuant has examined the current trend in the Bitcoin Coinbase Premium Index. The “Coinbase Premium Index” is a measure that tracks the percentage variation between the BTC price on Coinbase (USD pair) and that on Binance (USDT pair).
This metric conveys how the purchasing or selling patterns vary between the user populations of these major cryptocurrency exchanges. Coinbase primarily attracts US-based investors, particularly large institutional players, while Binance accommodates users across the globe.
When the Coinbase Premium Index reflects a positive value, the asset is traded at a superior rate on Coinbase than on Binance. Such a situation indicates that American whales are exerting more purchasing or reduced selling pressure compared to international traders.
Now, here is the chart provided by the analytics firm that illustrates the trend in the Bitcoin Coinbase Premium Index throughout the past year:
The value of this metric has been notably positive in recent weeks | Source: CryptoQuant on X
As shown in the above chart, the Bitcoin Coinbase Premium Index experienced a significant rise into positive territory at the beginning of November and has since remained within this sphere, aside from a slight dip.
This trend indicates that the purchasing pressure on Coinbase has persistently outstripped that on Binance. The asset’s value underwent a sharp rally during this period, suggesting that this accumulation by US-based investors has driven the increase.
The chart indicates that this phenomenon has also been observed multiple times over the past year, with positive spikes in the Coinbase Premium Index typically signaling bullish trends for Bitcoin.
The latest surge to the new all-time high (ATH) exceeding $104,000 has also coincided with another significant upward spike in the indicator. Thus, American institutional investors appear to be playing a crucial role in the marketplace.
Considering this trend, the Coinbase Premium Index is undoubtedly an indicator to monitor in the near future, as emerging changes may once again foreshadow Bitcoin’s price direction.
BTC Price
At the moment of writing, Bitcoin is trading at approximately $100,800, an increase of over 6% in the last week.
It seems that the coin's price has realized a significant rise over the past day | Source: BTCUSDT on TradingView
Featured image from Dall-E, CryptoQuant.com, chart from TradingView.com
