The Bitcoin Coinbase Premium Gap has experienced a significant drop into negative territory recently, with its current value among the lowest in the past 18 months.
Bitcoin Coinbase Premium Gap Plummets
In a recent post on X, CryptoQuant community analyst Maartunn discussed the latest developments regarding the Bitcoin Coinbase Premium Gap. This indicator measures the variance between the BTCUSD price on Coinbase and the BTCUSDT price on Binance.
Coinbase is predominantly utilized by traders in the US, particularly large institutional investors, whereas Binance caters to a global audience. Consequently, the Coinbase Premium Gap illustrates the contrasting behaviors between American and offshore investors.
When the value of this metric is above zero, it indicates that the asset is priced higher on Coinbase compared to Binance. This trend suggests that users on the former platform are exerting greater buying pressure or less selling pressure compared to users on the latter.
Conversely, a negative value for the indicator implies that Binance may be experiencing higher accumulation, as the cryptocurrency is priced higher on that platform.
Below is the chart shared by Maartunn, showcasing the trend of the Bitcoin Coinbase Premium Gap over the past year and a half:
The graph above shows that the Bitcoin Coinbase Premium Gap has recently entered negative territory, suggesting that American investors are exhibiting increased selling pressure and reduced buying pressure. This indicates a decline in demand from US traders.
At present, the indicator stands at -$122, meaning the cryptocurrency is trading at a $122 discount on Coinbase relative to Binance. The last time this metric hit such a low was during the price crash in November.
Recently, US institutional investors have had a significant impact on the market, and the Coinbase Premium Gap, which serves as a proxy for their behavior, has typically correlated with the asset’s spot price. This correlation was evident in November when a downturn in cryptocurrency prices coincided with the metric dropping into the negative zone.
So far, Bitcoin has remained relatively stable despite the reduced demand from American whales, but it remains to be seen how long this stability will last, given the magnitude of the discount on Coinbase.
The current value of the Coinbase Premium Gap is among the lowest recorded in the last 18 months, appearing on only five occasions during this timeframe.
BTC Price
Bitcoin has been charting a generally sideways course lately, with its price hovering around $88,900.
