The data shows Coinbase’s Premium Bitcoin gap widened as the asset surged to $74,000, a potential signal that institutional users of the platform are supporting the run.
Bitcoin’s premium gap on Coinbase surged to $61 during rally
In the fresh one thread in X, CryptoQuant community analyst Maartunn talked about the latest BTC rally and what may be behind it. “Several data indicates that aggressive institutional demand contributed to the outbreak,” Maartunn noted. One such indicator is the Coinbase premium gap.
This indicator measures the difference between the Bitcoin price listed on Coinbase (USD pair) and the price on Binance (USDT pair). The metric value basically tells us the difference in buying/selling behavior on two cryptocurrency exchanges.
Coinbase serves American-centric traffic and its main clients are institutional, while Binance is used by traders from all over the world. Therefore, when Coinbase’s premium gap is positive, it may mean that US-based institutions have higher buying pressure (or lower selling pressure) than global users.
Previously, the indicator had a noticeable red value, which suggested that the asset was trading at a discount on Coinbase, but recently it has turned positive.
From the chart above, you can see that Bitcoin Coinbase Premium Gap has seen a piercing enhance with the recent enhance in BTC prices, suggesting that accumulation on Coinbase has driven this asset to a higher value than the global market. At the peak of the positive growth, the indicator reached $61. “This means that the BTC price on Coinbase was $61 higher compared to other exchanges, which is a strong signal of buying pressure from the US on the market,” the analyst explained.
Another factor pointing to institutional involvement in the rally is Hyblock’s data. As you can see in the chart below, Hyblock shows an enhance in time-weighted average price (TWAP) orders from a $10,000 cohort to $1 million.
A TWAP order is a trading algorithm that divides a immense order into smaller parts and executes them at regular intervals. “TWAP orders are typically used by large players who accumulate shares without moving the market too aggressively,” Maartunn said. The $10,000-$1 million cohort purchased $750 million worth of Bitcoin in such orders concurrently with the rally.
While institutions have shown demand, the analyst warned of a risk lurking beneath the surface: rising leverage in derivatives markets.
As you can see from the chart, Open Interest, an indicator that tracks the total number of positions in derivatives, has risen rapidly in both Bitcoin and altcoins. “If supporting rates slow down, over-leveraged positioning could quickly calm down, increasing volatility,” Maartunn noted.
BTC price
At the time of writing, Bitcoin is trading at around $72,600, up almost 6% over the past seven days.
