Bitcoin Coinbase Premium Index Has Turned Positive At 0.006, Why This Is Important
June 07 2024 - 8:30AM
NEWSBTC
The Bitcoin recent foray into $70,000 price territory has again
become a hot topic among investors, with many looking at a positive
price outlook. As a result of this fascinating price action, the
vast majority of long-term holders have seen their holdings cross
into profit zone. Particularly, the positive outlook seems to be
positive among US-based investors, as shown by the Coinbase premium
turning positive. Some see the return of the Coinbase premium as a
bullish signal that could continue to drive the price higher.
Coinbase Premium Index Flips Positive The Coinbase Premium Index
(CPI), which had been trading in the negative since May 18, has now
turned positive, according to a cryptocurrency analyst who cited
data from CryptoQuant. The Coinbase Premium refers to the
difference in Bitcoin’s price on Coinbase versus other major
exchanges. Related Reading: Shiba Inu Whale Enter Buying Frenzy,
715 Billion SHIB Snapped Up In Days When the premium turns
positive, it means Bitcoin is trading at a higher price on Coinbase
compared to Binance and, subsequently, other major crypto
exchanges. This is important because it shows increased demand for
Bitcoin on one of the largest US-based crypto exchanges. On the
other hand, a negative premium indicates a lack of substantial
buying pressure from US-based traders. Since Coinbase is a popular
entry point for new US crypto investors, a premium price indicates
money is flowing into Bitcoin. At the time of writing, data from
CryptoQuant shows that this premium recently reached 13.11. While
this may seem small, it definitely indicates the beginning of
buying pressure that could send Bitcoin on another leg higher
Interestingly, this flip into a positive Coinbase premium has come
with a less bullish outlook on Bitcoin among Korean and Asian-based
investors, at least in the short term. This information is revealed
by CryptoQuant’s Korea Premium Index, which has been on a downtrend
in the past two weeks. Bitcoin Continues To Hold Strong At the time
of writing, Bitcoin is trading at $71,095 and is up by 4.31% amidst
increased buying momentum, with the Bitcoin Open Interest recently
reaching its all-time high. While a positive Coinbase Premium is a
bullish indicator, the context around why it’s happening matters
greatly in determining where Bitcoin’s price may go next. Related
Reading: VanEck Revises Ethereum Prediction To Put Price At
$22,000, Here’s Why A large part of the positive premium could be
attributed to individual large holders called whales, with on-chain
data showing instances of huge Bitcoin transfers from Coinbase to
unknown private wallets. As mentioned earlier, a sustained
positive premium and interest from institutions and retail buyers
is the most promising scenario for Bitcoin to build on. However,
interest from Coinbase whales alone may not be enough to fuel a
prolonged, substantial price rally. For Bitcoin to continue its
upward trajectory, there must be a corresponding rise in the
interest shown by retail investors. Featured image created with
Dall.E, chart from Tradingview.com
Flow (COIN:FLOWUSD)
Historical Stock Chart
From Aug 2024 to Sep 2024
Flow (COIN:FLOWUSD)
Historical Stock Chart
From Sep 2023 to Sep 2024