Recent data indicates that the Bitcoin Coinbase Premium Index has taken a nosedive into negative territory in tandem with the latest dip in the asset’s price.
The Coinbase Premium Index is an intriguing measure highlighted by an analyst in a CryptoQuant Quicktake post. This metric looks at the percentage difference between Bitcoin’s price on Coinbase (USD pair) and its price on Binance (USDT pair).
Essentially, this index is a barometer for the varying buying or selling tendencies between the user bases of these two major cryptocurrency exchanges. The distinct character of each platform’s users plays a role here: Coinbase largely serves US investors, with a significant chunk being large institutional players, whereas Binance has a broader international audience. This comparison allows us to see how American whales stack up against global ones.
Here’s a chart revealing the behavior of the Bitcoin Coinbase Premium Index over the past week:
The chart vividly illustrates that this premium index has taken a sharp dive into negative numbers in the last 24 hours. Interestingly, this plunge coincides with the decline in Bitcoin’s market value itself.
A negative index indicates that there’s more selling pressure on Coinbase than on Binance. Consequently, it seems the U.S.-based users on Coinbase could be fueling the downturn.
This trend has been quite visible throughout 2024, with the price displaying a significant correlation with the Coinbase Premium Index. Therefore, it seems the American institutional investors have been pivotal in steering the ship. If this index continues to linger in the negative zone in the coming days, Bitcoin’s downward trajectory may extend. Therefore, all eyes are on the U.S.-based whales to see their next move.
Moreover, institutional sellers are not the only ones active in the current market scene. Another analyst notes in a Quicktake post that the Bitcoin Binary Coin Days Destroyed (CDD) has spiked recently.
The Binary CDD tracks whether dormant tokens are starting to move. Older coins, which belong to long-term holders or HODLers, tend to stay put, so a spike in this indicator suggests these steadfast holders might be offloading their tokens.
The data implies that the Bitcoin Binary CDD is signaling increased selling pressure from long-term holders, adding another layer to the selling activity currently weighing on Bitcoin’s price.
At the moment, Bitcoin is trading around $100,400, reflecting a drop of over 3% in the last day.
The coin’s value has noticeably declined over recent days, as shown in the chart.
Featured visual from Dall-E, with data sourced from CryptoQuant.com and TradingView.com.
