Key takeaways:
Positive Coinbase Premium Index indicates robust US retail demand during market dips.
Strong inflows into ETFs and Bitcoin treasury companies support BTC’s recovery potential.
Despite aggressive short-side pressure, the likelihood of another liquidation event is diminishing.
Bitcoin (BTC) declined from its monthly peak of approximately $118,000, falling as much as 5.5% to Tuesday’s intraday low of $111,571. While this reflects only a 10.4% drop from the all-time high of $124,500, various metrics suggest that the $112,000 to $111,500 range may serve as the bottom before BTC rebounds to new highs.
Coinbase Premium remains positive despite price decline
Bitcoin’s recent climb to a four-week high of $118,000, from a low of $107,400 between September 1 and last Thursday, can be partly attributed to rising retail demand in the United States, as evidenced by a significant increase in the Coinbase Premium Index during that timeframe.
The Coinbase Premium Index measures the price difference between the BTC/USD pair on Coinbase, the largest US exchange, and the BTC/USDT equivalent on Binance.
Related: Largest long liquidation of the year: 5 key points in Bitcoin this week
The index remained in the positive territory, climbing to 0.075 on Monday from 0.043 on Sunday, even as Bitcoin price dipped 4% to $112,000.
“The Coinbase premium has remained positive all week,” even amid the recent sell-off, stated analyst BTC_Chopsticks in a post on X, adding:
“As long as the index remains positive, I remain optimistic about BTC.”
A rising Coinbase premium is indicative of increasing demand from US retail investors.
Moreover, Bitcoin’s apparent demand, which offers a more comprehensive on-chain perspective of global BTC demand, persists despite yesterday’s price decrease, with a slight rise in the last 24 hours.
This indicates that new investors continue to enter the market, providing the momentum necessary for BTC price recovery.
Institutional Bitcoin demand “remains steady”
BTC’s potential for growth is supported by increasing institutional demand, as demonstrated by strong inflows into Bitcoin investment products.
Data from CoinShares indicates that institutional investors increased their investment in Bitcoin products, with inflows reaching $977 million, accounting for over 51% of total inflows last week.
US-based spot Bitcoin ETFs witnessed $876 million in net inflows last week, according to data from SoSoValue.
Bitcoin treasury companies are actively accumulating, with Japan’s Metaplanet becoming the fifth-largest Bitcoin holder after acquiring 5,419 BTC for $632.53 million, bringing its total holdings to 25,555 BTC, valued at nearly $3 billion.
Michael Saylor’s Strategy added 850 BTC for $99.7 million last week, raising its total Bitcoin holdings to 639,835 BTC.
“Despite short-term setbacks, institutional support remains strong,” trading firm QCP Capital noted in a report to investors on Tuesday, adding:
“Strategy and Metaplanet continue to accumulate, while spot ETF inflows last week indicate ongoing dip-buying.”
Traders are also preparing for October, which is “historically BTC’s strongest month, with active demand for 120K–125K Calls,” they noted.
BTC withstands sell-side pressure from short traders
Despite persistent sell-side aggression on Binance derivatives since mid-July, Bitcoin has largely maintained its position within a narrow $110,000–$120,000 range. The Cumulative Volume Delta (CVD) data remains negative, indicating continuous short-selling pressure from takers.
The price’s inability to significantly decline further suggests that this flow is being absorbed, implying accumulation.
This structural strength may be supported by liquidation data indicating reduced downward pressure.
Bitcoin researcher Axel Adler Jr stated that while the extensive long liquidations observed on Monday suggested bears were in control of the market, the frequency of liquidations remains low, adding:
“The risk of further bearish pressure from liquidations is medium.”
Risk of further bearish pressure from liquidations is medium.
Net Liquidations remain negative near −40M, reflecting ongoing long wipeouts and maintaining downside pressure. Yet the Liquidation Intensity Z-Score (365d) is neutral/moderate, suggesting no cascade risk for… pic.twitter.com/FRu9spsyCZ
— Axel 💎🙌 Adler Jr (@AxelAdlerJr) September 23, 2025
Strong US retail demand, substantial institutional support, and reduced risk of liquidation-driven declines reinforce the notion that Bitcoin is forming a bottom near $112,000.
While short-term volatility may continue, the underlying bid, possibly from institutional sources, could make a significant drop below this level increasingly unlikely.
This article does not constitute investment advice or recommendations. Each investment and trading decision carries risk, and readers should perform their own due diligence.
